US Department of Labor files suit alleging Rancho Fiesta restaurant failed to pay workers nearly $383K in minimum wage and overtime pay

Type of Action: Fair Labor Standards Act Lawsuit

Name of Defendant: Sanchez Inc., doing business as Rancho Fiesta, Lorenzo Sanchez

Allegations: An investigation by the U.S. Department of Labor's Wage and Hour Division found that the Mexican cuisine restaurant and shareholder Lorenzo Sanchez, who managed day-to-day operations of the Mansfield, Ohio, establishment, violated the Fair Labor Standards Act.

The lawsuit alleges that the restaurant and its manager did not pay workers for hours worked over 40 in a workweek and failed to pay legally required overtime at time and a half their hourly rate of pay. Additionally, the company failed to maintain accurate records of all hours worked by its employees.

Wage and Hour investigators estimated that 29 workers are due more than $383,000 — for minimum wage and overtime violations.

The minimum wage and overtime violations resulted when the manager directed workers to clock in for just 40 hours while routinely working 45 to 65 hours per week. Investigators also found that two employees were paid just $775 for 134 hours of scheduled worktime every two weeks. The restaurant also employed one minor in violation of school year work hour rules. This included scheduling the minor to work past 7 p.m. on school nights and for more than three hours per day when school was in session.

The company was also assessed $33,050 in civil money penalties for repeated violations of the FLSA. Investigations in 2010 and 2013 also found violations of minimum wage and overtime rules. The company paid a total of $55,075 in back wages and penalties as a result of the two previous investigations.

Quote: "This is the third time Wage and Hour investigators have found Rancho Fiesta in violation of the Fair Labor Standards Act. Denying these workers the wages they rightfully earned harms not only the employees and their families, but makes it harder for law-abiding employers to compete," said George Victory, district director for the Wage and Hour Division in Columbus. "The Wage and Hour Division will use every enforcement tool at our disposal to ensure a fair day's pay for a fair day's work."

Resolution: The suit seeks full payment of the back wages, estimated to be more than $383,000, and an equal amount in liquidated damages for the employees. The suit also seeks to enjoin the company and Sanchez from violating the FLSA in the future.

The FLSA requires that covered, nonexempt employees be paid at least the federal minimum wage of $7.25 per hour for all hours worked, plus time and one-half their regular hourly rates for hours worked beyond 40 per week. The FLSA provides that employers who violate the law are, as a general rule, liable to employees for their back wages and an equal amount in liquidated damages. Liquidated damages are paid directly to the affected employees. Additionally, the law requires employers to maintain accurate time and payroll records and prohibits retaliation against employees who exercise their rights under the law.

Court: U.S. District Court for the Northern District of Ohio, Eastern Division

Docket Number: 1:15-cv-1427