News Release
US Department of Labor finds Houston Denny’s franchisee failed to pay minimum wage, overtime; made illegal deductions for uniforms
HOUSTON – As vaccination levels rise and weather warms in the U.S., more Americans have returned to dining out. Much has changed in the restaurant industry since 2020, but a few things have not. Servers remain among the lowest-paid workers, and provide good service in the hope of earning good tips to make ends meet. They depend upon getting paid all of their hard-earned wages.
When a restaurant employer fails to pay overtime and makes matters worse by illegally deducting uniform costs from workers’ pay, a server’s job feels that much harder.
In Houston, an investigation by the U.S. Department of Labor’s Wage and Hour Division found Rams Food Inc. – the operator of three Denny’s locations – violated minimum wage, overtime and recordkeeping provisions of the Fair Labor Standards Act. The investigation led to the recovery of $73,735 in back wages to 160 tipped employees.
The division found Rams Food deducted the cost of uniforms from hourly and salaried employees illegally, causing minimum wage violations. The employer also failed to combine all hours individual employees worked in multiple positions and at multiple locations for the business in the same workweek. By doing so, Rams Food failed to recognize and pay overtime when workers totaled more than 40 hours in a workweek. The employer also failed to maintain records accurately for tipped employees, in violation of the FLSA.
“Employers must pay workers all the wages they have earned. Servers count on every dollar to care for themselves and their families,” said Wage and Hour District Director Robin Mallett in Houston. “The outcome in this case should remind other employers to review their pay practices to avoid violations like those found in this case. Employers may call us, confidentially, to speak with a trained Wage and Hour professional to get their questions answered.”
The department offers numerous resources to ensure employers have the tools they need to understand their responsibilities and to comply with federal law, such as online videos and confidential calls to local Wage and Hour Division offices.
For more information about the FLSA and other laws enforced by the division, contact the agency’s toll-free helpline at 866-4US-WAGE (487-9243). Learn more about the Wage and Hour Division, and use its search tool if you think you may be owed back wages collected by the division.
