Wage War

Originally Posted on The Yale Herald - Medium via UWIRE

Goodfellas Restaurant, which sits at the intersection of State Street and Trumbull, offers high-priced Italian fare paired with higher-priced French wines. 10 television sets, mounted on its walls, constantly play some of the most popular gangster movies of all time: The Godfather, Gangs of New York, Goodfellas. The restaurant was, strangely enough, also named the most romantic restaurant in New Haven county by Connecticut Magazine in 2012. Goodfellas widely advertises its Ladies’ Night menu, just $30 for an appetizer, entree, and dessert (plus a $10 charge for splitting plates). What the restaurant tries to keep hidden, however, is its history of stealing wages from their workers.

In 2015, five former employees sued the restaurant with claims of unpaid wages, unpaid overtime, physically-demanding working conditions, and “racist, xenophobic, and homophobic slurs.” Claims of unfit working conditions had arisen as early as 2011, but went uninvestigated. The New Haven–based organization Unidad Latina en Acción (ULA) picketed the restaurant with chants of “antipasto, anti-worker.” The website Boycott Cafe Goodfellas is still up and running, tallying the $23,000 in stolen wages owed to the workers as of 2011. In 2016, the lawsuit was finally settled, seven years after ULA began their boycott.

ULA members protesting outside the restaurant. Image from Boycott Cafe Goodfellas.

These sorts of protests are not uncommon in the New Haven community. In 2016, Yale students joined ULA in protest of wage theft at Thai Taste and Gourmet Heaven. The protests at Thai Taste were among the most prolific on Yale’s campus, and judges ordered a $36,000 payment to workers for unpaid overtime. Gourmet Heaven owner Chung Cho (no longer affiliated with the renamed Good Nature Market) had the largest settlement of all, paying out over $200,000 to over 20 employees for lost wages. One protester from ULA told the New Haven Independent, “In these times we’re asking that the minimum wage be increased [to] $15 an hour, we still see workers making $4 an hour, $7 an hour like at Thai Taste, $4 to $6 an hour at Gourmet Heaven. [sic]”

Today, wages are a central topic in Connecticut politics. On Feb. 20, 2019, Connecticut Governor Ned Lamont, SOM ’80, unveiled his new budget plan, includes a raise in the hourly minimum wage from $10.10 to $11.25. If all goes according to plan, minimum wage will reach $15 by 2023. The budget plan says nothing, however, about the hourly server wage, which is the pay that workers receive when performing job functions that involve tips. The server wage is set at $6.38 in Connecticut and applies to all restaurants and bars across the state. This seems to make sense, but what’s troubling is that restaurants seeking to avoid minimum wage requirements continue to pay workers the $6.38 while workers are performing non-service functions, such as washing dishes, cleaning up, or working take-out. Many service workers will perform such non-service functions for at least an hour a day, resulting in wage loss of at least $1,000 per year.

According to employee rights lawyer Richard Hayber, most workers are unaware of the subtleties of these laws, permitting most restaurants to illegally underpay their workers with no comeuppance. Current Connecticut minimum wage allows for a yearly salary of about $21,000 given a 40-hour work week schedule. Excluding their tips, employees at Gourmet Heaven and Thai Taste were left with a salary of about $10,000.

Intentionally misclassifying workers is not unique to restaurants. In the retail industry, salespeople are misclassified as managers to lower their pay; in delivery, drivers get misclassified as independent contractors; in insurance, underwriters are misclassified as administrators. Each industry has its own manner of scamming employees in order to deny them the full value of their wages, such that many of these workers earn far less than minimum wage. Wage theft is not as simple as taking money out of the paycheck of a worker without their knowledge. It is a systematic process of denying workers their rights.

The Hayber Law Firm is currently managing several open cases surrounding wage theft and employee rights in Connecticut restaurants. When I reached out to a lawyer who represents one of these restaurants, I received a threatening call telling me to “tread carefully” to avoid starting “a war.” I was also told to check the criminal records of an employee at the Hayber Law Firm. I responded that I did not see how that was pertinent, to which the lawyer suggested that I was unwell. He spoke bitterly about the worker who brought forward the lawsuit, likening their case to reaching a hand out to beg for money.

Such a response is consistent with what Richard Hayber believes is characteristic of the offending restaurants. Hayber claimed that most restaurant owners refer to the non-service work as “incidental to service,” implying that this work deserves a payment less than minimum wage. These sorts of arguments can blind the workers to their own rights and obscure the prevalence of exploitation.

Hayber went so far as to say he believes most restaurants in Connecticut fail to comply with Connecticut wage standards; however, wage theft litigations are still not entirely common. Hayber’s associate, Michael Petela, says, “It’s definitely more common for somebody to come to us for a different type of problem. And then we’ll, by chance, spot an issue such as this.” Hayber explained to me that the reason most people reach out to an employee rights lawyer is either due to being laid off or sexually harassed. The issue of wage theft, however, always seems to come up in restaurant litigations. Hayber said to the Connecticut Law Tribune, “Servers are among the lowest-paid workers in our economy. They are typically young and don’t always know their rights.”

However, a recent court ruling has the potential to majorly change the representation of wage theft in Connecticut. In October 2017, Jacqueline Rodriguez filed a lawsuit against Chip’s Family Restaurant, an IHOP-esque restaurant with six locations across Connecticut. Rodriguez claimed that the practices of Chip’s Family Restaurant were in violation of Connecticut Minimum Wage Law, as she along with other servers were paid at $6.38 for non-service duties such as taking out garbage, sweeping, and stocking.

Although Rodriguez filed the claim, several other workers at Chip’s expressed similar concerns. This past Friday, Judge Carl Schuman granted her case class certification, authorizing all other employees who worked from October 2015 to March 2018 to join the lawsuit. Judge Schuman explained that although Chip’s disputed that such treatment occurred, they were unable to dispute the fact that “every server has essentially the same claim.” If Rodriguez’s case triumphs, it will be a victory for over 300 members of the service staff of Chip’s Family Restaurant, all of whom claim stolen wages. The payout for the suit could amount to millions of dollars in stolen wages.

But, even now, Hayber calls this class certification ruling historic. His firm has previously been denied class certification in employee rights cases against Chili’s and TGI Fridays: this case is the first time class certification has been granted for an issue of wage theft. The ruling in the case against Chip’s, therefore, has already set a new standard for employee rights litigation in the realm of wage theft. Now that the case has become a class action lawsuit, Hayber believes that Chip’s and other restaurants like it will be held more accountable for their illegal practices.

The Chip’s case sets a standard for workers in the service industry to sue as a class. Future wage theft lawsuits will begin to have much larger payouts, and therefore much larger effects on the restaurant industry. As these cases become larger and more high-profile, workers in other restaurants or even other industries are more likely to become aware of their own wage rights.

Yet, a final ruling in the Chip’s case is still far away, and the effects of such a ruling will need time to take effect. In the meantime, service workers across New Haven and Connecticut are still victims of wage theft, often without their knowledge.

The Restaurant Opportunities Center United (ROC) is a national organization that attempts to combat issues of worker rights, including wage theft, working conditions, and racial equity. Founded in 2008, the organization has since won over $10 million in lost wages and discrimination payments for affected workers. The ROC has been instrumental in advocating for raising the server wage in states across the US.

The ROC has a free app called the Diners’ Guide that offers information about whether or not a given restaurant complies with standards of wages, racial equity, sexual harassment policy and training, and employee working conditions. If a restaurant satisfies a majority of these categories, it will be given a Gold-rating. The closest Gold-rated restaurant to the Yale campus is 50 miles away. Granted, this lack of Gold-ratings may not truly be an issue of employee rights, but rather the lack of a wide user base. By engaging with this database, however, New Haveners (both consumers and servers alike) can begin to flag restaurants that fail to maintain the dignity of their workers, holding restaurants accountable for their damages unlike ever before.

While Governor Lamont recognizes an issue with wage standards in his budget plan, by ignoring the server wage, he fails to address the issue in its entirety. Server wage is the very mechanism by which restaurants avoid paying minimum wage; while this loophole remains unclosed, raising the minimum wage may, unfortunately, remain meaningless for the most vulnerable. Cases like Rodriguez vs. Chip’s Family Restaurant have the potential to change the culture around minimum wage in the service industry. However, the legal process is slow. To advocate for worker rights in the present, consumers must actively seek out information about the treatment of employees in the restaurants they visit and attempt to learn whether a restaurant is worthy of a Gold-rating. It may well be that restaurants will continue to steal the wages of the workers they employ. But they cannot rob workers of their voices.

Wage War was originally published in The Yale Herald on Medium, where people are continuing the conversation by highlighting and responding to this story.

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