Atlanta Employment Attorneys Blog
As an employer, there are many ways to resolve a minimum wage dispute. Sometimes, there is no way within your control to keep the matter from going to trial but, oftentimes, options to avoid time-consuming and potentially expensive litigation exist if you desire to pursue them. When you are facing a potential Fair Labor Standards Act issue, a knowledgeable Atlanta wage and hour lawyer can provide assistance on many fronts. Your legal team can investigate the issue, determine what happened, and then advise you regarding the strengths and weaknesses of your position, in addition to advising you about all your options and which one makes the most sense, whether that is settling, arbitrating, or litigating.
A skilled advocate can also spot when the best solution is none of those. A 2024 case to our north is an example of such a solution.
In January, a server at a Tennessee Waffle House restaurant sued her employer for minimum wage violations of the FLSA.
Servers at the restaurant were tipped employees, meaning that the law allowed the eatery to pay them a cash wage of as little as $2.13 per hour, which is the floor established by federal law. (In both Georgia and Tennessee, the minimum wage is $7.25 and the minimum cash wage for tipped workers is $2.13, as proscribed by the federal statutes.)
The ‘Tip Credit’ for Restaurant Servers and Other Tipped Workers
The $5.12 difference between those two figures represents something called the “tip credit.” Federal law allows employers to pay tipped workers a base wage of as little as $2.13 per hour as long as those workers earn at least $5.12 per hour in tips — meaning that the worker’s total gross wages will have been at least $7.25 per hour. If a worker earns less than that in tips, the law demands that the employer make up the difference to ensure that the worker receives pay that equals $7.25 per hour or more.
The Waffle House server’s lawsuit alleged that her employer “apparently assumed Plaintiff and similarly situated servers earned enough tips each shift to amount to the difference between the sub-minimum amount they received and $7.25 per hour (of which they did not earn) and” entered those tip amounts into its payroll system as if they were actually received by the servers. The complaint asserted that the worker earned less than $7.25 per hour during “numerous shifts.”
Less than seven months later, the case was over. The Knoxville News Sentinel reported that, on July 30, the server dropped her lawsuit. According to the report, the woman filed her request for dismissal after the employer “provided ‘facts … regarding her employment.’ There was no further explanation in the two-sentence filing.” The employer in this dispute succeeded in ending the matter with no need to litigate or pay a settlement simply by providing the disgruntled employee with additional “facts” relevant to her employment that she may not previously have had. As noted above, one of the keys to success is carefully assessing all the options and then wisely determining which one is the best.
Preventing FLSA Problems
Another place where skilled legal counsel can help you occurs before you have a problem. By reviewing and analyzing your business’ pay practices to ensure that everything your business does is 100% compliant with all the FLSA’s requirements from minimum wage to overtime pay to classification, your legal team can help you to drastically reduce the chances of problems down the road.
If you have questions about a specific FLSA issue or FLSA compliance generally, the experienced Atlanta wage and hour attorneys at the law firm of Parks, Chesin & Walbert have the information and advice you need. Contact us today at 404-873-8048 or through this website to schedule a consultation to learn how we can help you.