Xanh Restaurant in Mountain View will be paying more than $90,000 to employees after a U.S. Department of Labor investigation found the company failed to pay overtime wages.
Half of the $93,381 to be paid by the Vietnamese restaurant will compensate workers for overtime, and half will be paid to the workers as damages, said Jose Carnevali, deputy regional director of public affairs, U.S. Department of Labor in San Francisco.
"This settlement puts money back in the hands of employees who rightfully earned it," said Susana Blanco, district director, San Francisco Wage and Hour Division, U.S. Department of Labor. The labor department found the restaurant owes back wages and damages to 18 workers.
Workers were paid straight time rather than time and a half, and the restaurant disguised the straight time payments as bonuses on its payroll, the labor department said in a statement.
"When an employee works beyond 40 hours in a workweek, every hour worked after that needs to be paid at time-and-a-half," Blanco said. The labor department's news release says the Fair Labor Standards Act is the law that applies to overtime wages.
Before the City Council moved to raise the city's minimum wage by $1.30 an hour to $10.30 on Oct. 9, Xanh co-owner Amanda Pham-Huynh told the council she was concerned about having "an adequate flow of income" to pay waitstaff, who earn minimum wage plus tips. Waitstaff make up three-quarters of her 70 employees. She said she has employed as many as 400 to 500 people in the restaurant's eight years of business.
"When you count tips in a two-week time frame I have to pay $60,000" to employees in tips, Pham-Huynh told the council. "That's a lot of money to give and our rent is very high in downtown Mountain View."
The release says the FLSA makes employers liable for paying workers back wages and damages, and both are paid directly to workers.
Xanh Restaurant will also be paying $1,683 in penalties to the federal government.
Comments
Castro City
on Oct 17, 2014 at 2:21 pm
on Oct 17, 2014 at 2:21 pm
The tips you are paying out is not part of any wage or payroll you control! You are simply acting as a bank for that portion of the check identified as a tip on the receipt. You get off easy getting to pay only minimum wage and having the patrons fairly compensate your employees. I wonder what the real amount of your payroll is every two weeks.
Monta Loma
on Oct 17, 2014 at 2:42 pm
on Oct 17, 2014 at 2:42 pm
It's obvious that the govt doesn't want jobs in the city.
If the workers don't like their pay, the beauty of this country is you can go somewhere else where they will like their pay. Don't give me this BS that the govt has to step in to protect works, a bunch of BS. More govt control telling everyone, what they can and can't do.
Communistic/Socialism is just around the corner. We saw what a great success it was in Russia, and now we want to bring it here.
Waverly Park
on Oct 17, 2014 at 2:57 pm
on Oct 17, 2014 at 2:57 pm
To Basic Accounting - you are correct that tips are paid by the patrons of the restaurant; however, these are subject to social security and medicare taxes which the employer is responsible for. I can't say how the restaurant's owner came up with the amount but there is a direct out of pocket cost to her.
As a frequent diner to various establishments, I find it more and more difficult to tip the 15% because the service isn't good and the staff expects the tip no matter what. The other reason is the 15% is based on the price of the meal. This cost will go up because the minimum wage is going up, water cost is going up, and etc. Should I really be tipping at 15% of the bill?
Old Mountain View
on Oct 17, 2014 at 3:16 pm
on Oct 17, 2014 at 3:16 pm
The employer tax on tips is not a whole lot of money. It's going to be a little bit more than 1 percent of the tips received. So, if an employee gets $2,000/month in tips, the restaurant would have to pay about $20 in tax.
To our Monta Loma friend who thinks overtime is a Communist conspiracy: Hey, buddy! Guess what? They DRIVE AUTOMOBILES in Russia. I guess we should dump our cars then?? Well, we can't bike, because...THEY ALSO USE BIKES IN RED RUSSIA!!! Hmm...Wow..we are in big trouble, aren't we?
Old Mountain View
on Oct 17, 2014 at 3:34 pm
on Oct 17, 2014 at 3:34 pm
@Hmmmmm: Newsflash: Russia is not communist anymore - much more of an oligarchy. Perhaps you should have used China as an example... Then again they are also much like an oligarchy. I guess you could use N. Korea, though that is more of a cult of personality. Fortunately, there are no "true" communist nations left since they all collapsed under the weight of collectivism and central planning. Looks like the socialists are pretty much in the same pickle - just ask the French.
Regarding your comment about it only being "$20" in taxes to the employer: Hey, comrade! guess what? You socialists are quite keen on spending other peoples money; however, it becomes quite a different story when it comes to your own money.
Cuernavaca
on Oct 17, 2014 at 3:45 pm
on Oct 17, 2014 at 3:45 pm
To It's quite obvious and Steve: I realize that neither one of you characters can actually think for yourselves. It's also quite obvious that you let wingnut media do the thinking for you.
What neither of you get is that this is a matter of a business following a law that has been on the books for quite some time. But then, of course, you characters only care about the laws that you actually like, and ignore the rest.
Old Mountain View
on Oct 17, 2014 at 5:06 pm
on Oct 17, 2014 at 5:06 pm
The restaurant owner seems to be under the impression that the tips belong to her but she's giving them $1000 out of the goodness of her heart. Unfortunately a lot of Asian places have this attitude towards their employees who are reluctant to speak out.
Waverly Park
on Oct 17, 2014 at 5:13 pm
on Oct 17, 2014 at 5:13 pm
Due to repeated violations of our Terms of Use, comments from this poster are automatically removed. Why?
Whisman Station
on Oct 17, 2014 at 9:49 pm
on Oct 17, 2014 at 9:49 pm
As Armstrong and Getty on the morning station put it when ever the government steps in. "How's your utopia going so far?"
North Whisman
on Oct 19, 2014 at 8:06 am
on Oct 19, 2014 at 8:06 am
Socialism works very well in the Scandinavian countries, which have a far higher quality of life than the USA.
Registered user
Sylvan Park
on Oct 20, 2014 at 9:02 am
Registered user
on Oct 20, 2014 at 9:02 am
"When you count tips in a two-week time frame I have to pay $60,000 to employees in tips. That's a lot of money to give and our rent is very high in downtown Mountain View."
I do not know, maybe this phrase was taken out of context, but it does sound strange. What tips have to do with rent? And "money to give" sounds like she takes it from her own pocket.