US Department of Labor recovers $375K for 11 Oregon restaurant workers whose employer kept tips, denied overtime wages illegally

MEDFORD, OR – A federal investigation has recovered $375,233 in back wages and liquidated damages from a Medford restaurant for 11 workers after finding their employer kept servers tips, threatened to fire employees if they kept cash tips, and failed to pay kitchen workers overtime.

The U.S. Department of Labor's Wage and Hour Division determined that Bonsai Teriyaki – operating as Bonsai Teriyaki and Sushi – collected and withheld cash and credit card tips earned by seven servers, and warned them they’d be fired if they failed to surrender cash tips. The employer also illegally denied four cooks and sushi chefs their overtime wages due by misapplying overtime rules for salaried, exempt workers. Bonsai Teriyaki’s actions violated the Fair Labor Standards Act.

The division’s investigation recovered $187,616 in back wages and $187,616 in liquidated damages for the workers. The affected employees stand to recover between $16,000 and $93,000 in back wages and liquidated damages. The division also assessed $5,091 in civil money penalties for the willful nature of the violations.

“Wage theft is a serious concern for restaurant industry workers, often low-wage earners who are vulnerable and reluctant to complain,” explained Wage and Hour Division District Director Carrie Aguilar in Portland, Oregon. “Our investigation found Bonsai Teriyaki and Sushi withheld hard-earned wages from servers deliberately and denied overtime pay to others. Its outcome shows the U.S. Department of Labor will defend workers’ rights and hold to account those employers who cheat their employees.”

In fiscal year 2021, the Wage and Hour Division recovered more than $34.7 million for more than 29,000 workers in the food service industry. In 2022, the Bureau of Labor Statistics reports near record numbers of job openings and workers in the accommodations and food services industry quitting their jobs. 

“Employers who do not respect their workers’ rights will likely struggle to retain and recruit the people they need to remain competitive, as workers look for opportunities with employers who do,” added Aguilar.

The Wage and Hour Division protects workers against retaliation and has regulations that also prohibit harassment, intimidation or adverse actions against employees that assert their worker rights. 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 and how to file an online complaint. Workers and employers with questions can contact the division’s toll-free helpline at 866-4US-WAGE (487-9243), regardless of where they are from.

Download the agency’s new Timesheet App for android devices to ensure hours and pay are accurate.