Missouri steakhouse’s wage violations lead US Department of Labor to recover $171K for 75 workers denied tips, overtime, minimum wages

POPLAR BLUFF, MO – A U.S. Department of Labor investigation has recovered $171,834 for 75 servers, sushi and hibachi chefs employed at a Poplar Bluff restaurant where numerous violations of federal wage and hour laws denied some workers their full tips, and all of them, their legally earned wages.

An investigation by the department’s Wage and Hour Division  found Fuji Japanese Steakhouse and Sushi Bar  – operated by Xin Inc. – failed to pay the proper overtime rate in workweeks exceeding 40 hours, and made deductions from pay that illegally reduced employees’ hourly pay to amounts below the federal minimum wage of $7.25 per hour, both violations of the Fair Labor Standards Act. The employer also operated an invalid tip pool in which they forced tipped workers to share gratuities with co-workers who did not customarily receive tips.

“In big cities and in rural communities like Poplar Bluff, the U.S. Department of Labor is committed to safeguarding the rights of workers and ensuring they receive all of their rightfully earned wages,” explained Wage and Hour District Director Jim Yochim in St. Louis. “Xin Inc.’s actions hurt workers and their families by denying them their full wages. Unfortunately, the minimum wage and overtime violations found in this investigation are too common in the restaurant industry.”

Specifically, investigators found Fuji Japanese Steak House did the following:

• Collected 20 percent of server’s tips and distributed them to sushi and hibachi chefs, bussers and to-go host who did not have direct interaction with customers, which resulted in an invalid tip pool.
• Deducted the cost of uniform aprons and name tags from workers’ cash wage which sometimes caused their hourly wage to fall below the required federal minimum wage.
• Calculated the overtime rate on the cash wage of tipped employees rather than the federal minimum wage as required under the FLSA.
• Failed to pay sushi chefs overtime when their salaries did not meet the minimum salary level requirement and their duties did not satisfy requirements to allow a waiver of the employer’s overtime obligations.

All of these actions are FLSA violations.

In fiscal year 2021, the Wage and Hour Division recovered more than $34.7 million for more than 29,000 food service workers, in an industry ranked first among the division’s “low-wage, high-violation” employers.

Bureau of Labor Statistics’ data projects more than 1.3 million job openings in the accommodation and food services industry and about 766,000 workers quitting their jobs in June 2022. In this environment, employers must be highly competitive to keep and attract workers.  

“As restaurant industry employers work hard to find the employees they need to operate their businesses, those who fail to respect workers’ legal protections are likely to struggle to retain and recruit workers more than employers that treat workers with dignity,” Yochim added.

The department’s Quick Service Restaurants Compliance Assistance Toolkit outlines employer obligations and wage laws for the industry.

For more information about the FLSA and other laws enforced by the Wage and Hour Division, contact the division’s toll-free helpline at 866-4US-WAGE (487-9243). 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. Download the agency’s new Timesheet App for android devices to ensure hours and pay are accurate.