Federal court orders 3 restaurants, owners to pay $1.45M in back wages, damages to 116 workers denied overtime wages

PITTSBURGH – Following litigation by the U.S. Department of Labor’s Office of the Solicitor, a federal court has entered a consent judgment against three restaurants – one in Pennsylvania and two in West Virginia – and their owners after investigators found they paid back-of-the-house employees off-the-books salaries for all hours worked and denied them overtime pay for hours worked over 40 in a workweek.

The judgment, entered in the U.S. District Court for the Western District of Pennsylvania on March 16, 2022, requires Fusion Japanese Steakhouse Inc. in Washington, Pennsylvania; Fusion Japanese Steakhouse Inc. in Vienna, West Virginia; and Z&S International Cuisine Inc., operating as Fusion Japanese Steakhouse of Wheeling in Triadelphia, West Virginia, and owners Yuan Zheng Xiao and Christine Xiao, to pay $1.45 million – $725,000 in back wages and an equal amount in liquidated damages – to 116 current and former workers.

The department also assessed the restaurants and their owners $76,724 in civil money penalties for the willful nature of their violations. The employers’ pay practices and failure to maintain records of hours worked violated the Fair Labor Standards Act. In addition to the back wages and damages, the judgment prohibits the employers from future FLSA violations.

On three prior occasions – following investigations in 2012, 2011 and 2010 – the restaurants and owner Yuan Zheng Xiao have paid back wages to workers after violations of the FLSA’s minimum wage, overtime and recordkeeping provisions were discovered.

“This legal action recovers the workers’ hard-earned wages and sends a strong message to other restaurant employers that violations come at a high cost,​” said Solicitor of Labor Seema Nanda. “The U.S. Department of Labor is prepared to use every tool available, including litigation, to prevent employers from depriving workers of their wages.”

“Wage theft is illegal, it harms workers and their families, and undercuts responsible employers who abide by the law,” said Acting Wage and Hour Division Administrator Jessica Looman. “This sizeable judgment on behalf of restaurant workers demonstrates the Department of Labor’s commitment to protecting these essential workers.”

The Bureau of Labor Statistics projects that 958,000 food and accommodation services workers left their positions in December 2021. BLS also projects about 41,400 openings for food service managers each year, on average, from 2020 to 2030.

“Business owners need to understand retaining and recruiting workers becomes much more difficult in today’s changing job market where workers have choices about where and for whom they work,” Looman explained. “Employers who take advantage of workers by violating their legal rights will find it increasingly difficult to find the people they need to fill jobs and stay in business.” 

The consent judgment follows an investigation by the division’s Pittsburgh District Office and litigation by the Regional Solicitor’s Office in Philadelphia.

Learn more about the Wage and Hour Division, including a search tool to use if you think you may be owed back wages collected by the division. The division protects workers regardless of immigration status and can communicate with workers in more than 200 languages.