Honolulu restaurant to return more than $57K in tips and unpaid wages to 68 employees

Employer: Paradise Inn Hawaii LLC, doing business as Tsukiji Fish Market Restaurant

Site: One restaurant location at the Ala Moana Shopping Center in Honolulu

Investigation findings: The employer unlawfully required servers to share their tips with non-tipped employees while still paying those servers an hourly wage less than the full minimum wage. In most states employers only have to pay tipped workers a lower, so-called "tipped minimum wage" that — when added to tips left by customers — must equal at least the full minimum wage. Because the servers at Tsukiji Fish Market Restaurant were required to contribute their tips to an illegal "tip pool" for all of the restaurant's workers, the employer's ability to claim a tip credit was invalidated. Investigators from the Wage and Hour Division's Honolulu District Office found that 68 employees were owed $48,029 in tips and another $9,538 in back wages for minimum wage violations.

Tips are the property of the employee whether or not the employer has taken a tip credit. The employer cannot use an employee's tips, whether or not it has taken a tip credit, for any reason other than as a credit against its minimum wage obligations to the employee, or as part of a valid tip pool.

Resolution: When notified of the violations, the employer agreed to pay all the tips owed and back wages due and to change their current policies to ensure future compliance.

Quote: "Employers cannot take a lawful reduction or credit against their obligation to pay the federal minimum wage to servers while unlawfully requiring them to share their tips with traditionally non-tipped employees such as assistant managers and dishwashers," said Terence Trotter, the division's district director in Hawaii.

Information: For more information about federal wage laws administered by the Wage and Hour Division, call the agency's toll-free helpline at 866-4US-WAGE (487-9243). Information also is available at http://www.dol.gov/whd. Information about the tip credit and tipped workers can be found here http://www.dol.gov/whd/regs/compliance/whdfs15.pdf