Buffet restaurants underpay staff: U.S.

By James P. Miller

Tribune staff reporter

The owners of 11 Chicago-area Chinese “buffet-style” restaurants agreed to settle federal Labor Department allegations that the restaurants underpaid employees in violation of the Fair Labor Standards Act.

Under the accord, the restaurants will pay a total of $665,000 in back wages owed to more than a hundred workers employed as busboys and kitchen help, the department said.

The Labor Department’s Chicago office filed the civil litigation against the buffet restaurants in September, saying that a three-year investigation of the businesses had found continuing violations of the law that governs pay practices.

In some cases, the government contended employers had failed to pay the primarily Asian and Hispanic workers the minimum $5.15 hourly wage. In others, the lawsuits alleged employees had worked as much as 66 hours a week without receiving overtime pay, even though the law requires employers to pay employees time-and-a-half for any work in excess of 40 hours in a week.

In announcing the lawsuits last year, Tim Reardon, administrator for the Labor Department’s Midwest Wage and Hour Division, said buffet-style Chinese restaurants, which specialize in low-cost, all-you-can-eat service, had been found to be particularly prone to wage-law violations. The government, he said at the time, was determined that “we will not allow employers this competitive advantage” of improperly low wages.

On Thursday, Reardon reiterated that view, saying, “Our priority at the Department of Labor is to protect low-wage workers.” The department, he said, “will not hesitate to aggressively enforce the law.”

In settling the lawsuits, the defendants’ restaurants did not acknowledge any wrongdoing. The proposed settlement is akin to a cease-and-desist order, in which the government says “don’t do any of these activities in the future,” explains Nathaniel Hsieh, a Chicago-based attorney who represented two of the 11 defendant businesses.

When asked if his clients specifically denied the government’s allegations, Hsieh said the size of the settlement amount suggests that the restaurateurs’ labor practices had in the past been “less than up to par.”

In settling the case, he noted, the defendants all agreed to adhere to federal labor law in the future. The settlements are subject to approval by the federal district courts where they were originally filed, in Chicago and Hammond, Ind.