Manhattan deli, owner owe $300K in back pay, damages to 64 employees denied legally required wages and overtime

NEW YORK — Customers at a busy Manhattan delicatessen, salad and sushi bar probably did not know the deli and its owner were underpaying workers who served them lunch each day.

An investigation by the U.S. Department of Labor's Wage and Hour Division of the Village 38 delicatessen at 575 Eighth Ave. found that 575 Market Corp. and its owner, Maria Park, violated the minimum wage, overtime and record-keeping requirements of the Fair Labor Standards Act.

The company paid some employees flat weekly rates ranging from $350 to $550, regardless of their long hours. As a result, some employees earned less than the legally required federal minimum wage of $7.25 per hour. The company also failed to pay overtime to most employees when they worked more than 40 hours per week. Investigators also found the deli attempted to use inaccurate and incomplete payroll records to conceal underpayments.

"Village 38 delicatessen's owner shorted these low-wage workers for her financial gain. By doing so, she also gained an unfair advantage over competitors who obey the law and pay employees wages they earned," said Maria Rosado, the Wage and Hour Division's deputy regional administrator in New York. "Employers who are underpaying their workers should note this outcome and take corrective action."

To correct these violations, the department secured a judgment in the U.S. District Court for the Southern District of New York that orders Park and her business to pay the affected employees $150,000 in back wages and an additional $150,000 in liquidated damages.

The judgment orders the following:

• Compliance with the FLSA.
• Use of an electronic timekeeping system or other means to record employees' work hours properly.
• Inform employees in English, Spanish, Korean or their native language of the terms of the judgment and their FLSA rights.
• Prohibits soliciting kickbacks from employees or taking retaliatory action against them.
• The department may request a court-appointed receiver if the defendants fail to make full payments.

The FLSA requires that covered, nonexempt employees be paid at least the federal minimum wage of $7.25 per hour, as well as time and one-half their regular rates for every hour they work beyond 40 per week. The law also requires employers to maintain accurate records of employees' wages, hours and other conditions of employment, and prohibits employers from retaliating against employees who exercise their rights under the law.

The Wage and Hour Division's New York City District Office conducted the investigation. Attorneys Lindsey A. Rothfeder and Andrew M. Katz of the department's regional Office of the Solicitor in New York litigated the case.

For more information about the FLSA, contact the division's toll-free helpline at 866-4US-WAGE (487-9243) or its New York City District Office at 212- 264-8185. Information also is available at http://www.dol.gov/whd/.

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Perez v. 575 Market Corp., doing business as Village 38, and Maria Park

Civil Action Number: 1:14-cv-01290 (PGG)