Outten & Golden: Empowering Employees in the Workplace

Posts Tagged ‘restaurants’

Labor Department Proposes Legalizing Wage Theft

Friday, December 8th, 2017

The Labor Department is moving quickly to establish a new rule that would make tips the property of restaurant owners instead of workers.

This week, President Donald Trump’s administration proposed getting rid of an existing rule that makes tips the property of servers that restaurant owners cannot take away.

Under the new proposal, restaurant owners who pay their employees as little as $7.25 per hour could do whatever they want with tips left by customers for waitstaff. Restaurant owners could even keep the tips for themselves.

The federal minimum cash wage for tipped workers—at just $2.13 per hour—is already lower than for other workers. This low subminimum wage means that tipped workers depend on tips for virtually all their take-home pay after taxes, so they receive their take-home pay directly from customers. Not surprisingly, tipped workers have higher rates of poverty, discrimination and sexual harassment. Undocumented and immigrant workers in the restaurant industry are particularly vulnerable to wage theft.

The administration’s proposal would take money out of the pockets of some of the lowest-paid workers in our country and hand it over to restaurant owners, many of them big corporations.

Does that sound familiar? This is the same kind of reverse Robin Hood scheme as the disgraceful tax bill now making its way through Congress.

We cannot let them get away with this. The administration is trying to sneak this change through without hearing from workers, customers or even employers who disagree at a time of year when tipped workers are the busiest. The deadline for comments on this proposal is Jan. 4, 2018.

This blog was originally published at AFL-CIO on December 8, 2017. Reprinted with permission. 

About the Author: Kelly Ross is the deputy policy director at the AFLCIO.

Restaurant (?!) Thinks It's Important to Take Away Customer's Legal Rights on Its Website

Monday, November 4th, 2013

 

PaulBlandWeb-172So how weird is this?  The Daily Grill, a very fancy and pricey steak house, encourages people to buy gift cards and make reservations on line.  (O.k., nothing weird yet, I admit.)  BUT, on their website is a bunch of super dull prose under the heading “Legal Notices.”  (For steak?)  And, as with so many other corporations, the Legal Notices include a provision for “Resolution of Disputes.”  The usual – the consumer has to arbitrate with a company picked by the corporation, the arbitration clause shortens the statute of limitations to a year (was THAT really necessary?), imposes a secrecy (“confidentiality”) provision, and it bans consumers from bringing class actions.
A restaurant with a Forced Arbitration clause.  What’s next?   If fancy steak houses want to strip their customers of their constitutional rights, will street vendors selling hot dogs and egg rolls be next?  Will a bus driver hand me a card saying “by occupying a seat, you consent that any dispute we may have will be subject to forced arbitration”?  Is there any ending point to corporations feeling empowered and entitled to insist upon taking away peoples’ rights?
It’s a particular creepy notion, in that I doubt that many of us think “well, it’s a steak house, so I better lawyer up.”  What in Pluto’s realm are these guys worried about?  Class actions?  Is there some history at the Daily Grill of them wiping out giant office parties with mass food poisoning?  Have they gotten in trouble in the past for misrepresenting something on the menu?  (Maybe the 16 oz. New York Strip is really 14 ounces?)  As my kid would say, “what NOW?”
One particularly ugly part of this provision – The Daily Grill is saying that just by LOOKING at its website, you’ve supposedly “agreed” to give up basic constitutional rights such as the right to trial by jury.  You don’t sign anything, you don’t say “I agree to the terms and conditions.”  You just look at this, and they think that means they can infer consent.  If Corporate America can define “consent” and “agreement” to be inferred from silence from looking at something, then consent has become a truly mongrelized, meaningless notion.
On the one hand, this may just seem like a ridiculous provision that no one should worry about.  But another way of looking at it is how Corporate America, emboldened by a string of arbitration-loving decisions from the five member conservative majority of the U.S. Supreme Court, has been racing to make a basic rule of operation that they don’t want to be part of the American legal system.
They don’t want to be accountable if they do anything to hurt you.
After reading this, I have a new suggested motto for The Daily Grill:  “If we accidentally kill you with food poisoning after you reserved your table on-line, we’re going to try to rig the system against your family and keep it all quiet.”  Who wants to eat at a restaurant with THAT motto?

This article was originally printed on Public Justice on November 4, 2013.  Reprinted with permission.

About the Author: F. Paul Bland, Jr. is a Senior Attorney at Public Justice since 1997, is responsible for developing, handling, and helping Public Justice’s cooperating attorneys litigate a diverse docket of public interest cases.

WORST SUPREME COURT ARBITRATION DECISION EVER

Thursday, June 20th, 2013

PaulBlandWeb-172So, today, in American Express v. Italian Colors, the U.S. Supreme Court said that a take-it-or-leave-it arbitration clause could be used to prevent small businesses from actually pursuing their claims for abuse of monopoly power under the antitrust laws. Essentially, the Court said today that their favorite statute in the entire code is the Federal Arbitration Act, and it can be used to wipe away nearly any other statute.

As Justice Kagan said in a bang-on, accurate and clear-sighted dissent, this is a “BETRAYAL” (strong word, eh?) of the Court’s prior arbitration decisions. You see, until now, the Supreme Court has said that courts should only enforce arbitration clauses where a party could “effectively vindicate its statutory rights.” Today, in a sleight of hand, the five conservative justices said that this means that arbitration clauses should be enforced even when they make it impossible for parties to actually vindicate their statutory rights, so long as they have a theoretical “right” to pursue that remedy.

The plaintiffs in this case, restaurants and other small merchants, claim that American Express uses its monopoly power over its charge card to force them to accept American Express’s credit cards and pay higher rates than they would for other credit cards. This is called a “tying arrangement” under the antitrust laws — American Express is alleged to be using its monopoly power over one product to jack up the price of another product to higher rates than it could charge in a competitive market.

For plaintiffs to prove this kind of case, they have to come up with hard evidence — economic proof — that costs hundreds of thousands of dollars. And each individual merchant has only lost, and thus can only hope to recover, a small fraction of that amount. The U.S. Court of Appeals for the Second Circuit recognized that if American Express’s arbitration clause (and particularly its ban on class actions) was enforced, that would mean that none of the small business plaintiffs could enforce their rights under the antitrust laws. And under a long line of Supreme Court cases, arbitration clauses are only enforceable when they permit the parties to effectively vindicate their statutory rights.

Today’s decision turns that rule on its head. According to Justice Scalia’s majority opinion, even if an arbitration clause would mean that no individual would ever actually be able to pursue an antitrust claim on an individual basis, the arbitration clause still has to be enforced. The law has changed dramatically — parties no longer have a right to “effectively” vindicate their statutory rights; they are left with the meaningless but formal right to pursue economically irrational claims if they choose to do so.

The decision is catastrophic for the antitrust laws, as well as for civil rights, consumer rights, and many other statutory rights. The decision is an unmitigated disaster, replacing adhesive contracts for an idea of actual law. The drafters of the FAA would not recognize what it has turned into.

Justice Kagan went on to state: “As a result, Amex’s contract will succeed in depriving Italian Colors of any effective opportunity to challenge monopolistic conduct allegedly in violation of the Sherman Act. … In the hands of today’s majority, arbitration threatens to become … a mechanism easily made to block the vindication of meritorious federal claims and insulate wrongdoers from liability.” Justice Kagan gets this one completely right. The entire point of the majority opinion is to use arbitration to insulate companies from any possibility of class action liability.

We used to have something called “The Federal Arbitration Act.” The Court today might as well have amended its real title to “The Federal Corporate Immunity Act.”

This article was originally printed on Public Justice on June 20, 2013.  Reprinted with permission.

About the Author: Paul Bland is a Senior Attorney at Public Justice.  He has argued and won more than 30 cases that led to reported decisions for consumers, employees or whistleblowers in four of the U.S. Courts of Appeals and the high courts of nine different states.

Your Rights Job Survival The Issues Features Resources About This Blog