The United States Department of Labor has recovered $72,564 from an illegal tip pool managed by a small cafe chain in Louisville, Kentucky.
The federal department’s Wage and Hour Division (WHD) announced today that the operators of three cafe locations from parent company Wiltshire Pantry allowed two managers to take a portion of servers’ tips.
The agency said that constitutes a violation of the Fair Labor Standards Act, which was revised in 2020 to ensure that tips go to regular employees, as opposed to managers or owners.
“Under no circumstance may employers or supervisors participate in a tip pool,” Wage and Hour Division District Director Karen Garnett-Civils said in the announcement. “The Fair Labor Standards Act prohibits managers and supervisors from keeping any portion of an employee’s tips for any purpose.”
According to the agency, the $72,564 will be returned to 34 workers affected by the tip pool. The company behind the pool, Wiltshire Pantry, maintains catering and event services, while operating three cafes under the Wiltshire Bakery and Café name. A spokesperson for the company declined DCN’s request for comment on the DOL findings.
A sunset scene in Louisville, Kentucky.
Louisville’s cafe industry has been notably prominent this year in the WHD’s enforcement of the revised Fair Labor Standards Act. In January of this year, the WHD announced it was recovering more than $300,000 in lost wages for workers at the Louisville-based chain Heine Brothers. Two weeks later, the agency announced it was recovering $188,000 in back wages from Louisville-based Sunergos Coffee and Please & Thank You, also for violations of the Fair Labor Standards Act.
At that time, Please & Thank You Owner Brooke Vaughn described the case to DCN as “nonsensical” and caused her to “lose faith” in government systems. Vaughn also characterized the case as a kind of cautionary tale to cafe operators in their application of the word “manager” in official titles.
“[The DOL] kind of just applied a template to all businesses, and it doesn’t really matter what your personal business structure is,” Vaughn told DCN in February. “I would say that the most important part is that other coffee shops need to know what the legal definition of manager is. They need to be concerned if they have somebody with a role as manager that isn’t actually doing managerial duties because the DOL doesn’t care.”
DCN’s request for comment from the DOL regarding the application of the law in Louisville was not immediately returned.
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Nick Brown
Nick Brown is the editor of Daily Coffee News by Roast Magazine.
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I never could comprehend WHY our goobermunt insists that an individual wearing the title “manager” must be excluded from the tips pool. Face reality: if it were not for the one experienced long term employee who “kniws the ropes” and keeps things flowing along on an even keel when less experienced hires would be dropping the ball, the place would not be getting so much in tips because service and quality would be flying out the drive-up window all day long. Managers step in to fill for the employee who got sicj and cak and does not show that day, or has to step out for two hours for a doctors appointment for her child, and so on. Yet they who carry the larger load daily dont get no tips?
WHY id government even speaking to such things? Let the shop owner set the terms, and anyone considering working there can decide to accept those terms or work elsewhere, or start their own shop.
Puts me in mind of the “swarms of officers going about eating up our substance”……..
Now if the owners set up a tip pool for the employees and, on the sly, divert any part of that pool ti ownership pockets, THAT is a foul. I remember the days when I, at my option, when well served or getting that extra mile service I could, at MY discretion, place any amount of money I desired to place directly into the hands of the one who gave the exceptional service, and that was fine. But now we all suffer under the imposition of the “least common denominator” standard. When I get lousey service I can always just give NO tip, but when I receive service above and beyond what is expected I cannot reward THAT server.
Thanks, government. as always making things better for “all”.
The reason “managers” are excluded from tip pools is because they make full hourly wages. Wait staff if they get tips don’t even make minimum wage per hour.
What it is, is poor ownership assigning “manager” titles to regular workers for cheaper labor. The usual ” oh,here’s more duties and responsibilities that you don’t get paid for, but here is a shiny name tag”.
Lazy , cheap ownership got caught.