Overtime Pay Violations Cost Restaurateur a Cool Quarter Million

Decatur, ILA restaurant owner who claimed to have the best interests of his staff at heart and remained unaware of overtime pay violations at one of his restaurants was, nonetheless, ordered to pay a quarter of a million dollars after the US Department of Labor launched an action against J. David Fuentes. The latter is the proprietor of Los Matadores, which operates two restaurants in Decatur, Illinois.

"There is no excuse for an employer to disregard federal labor standards," said Norma Cervi, director of the Wage and Hour Division's district office in St. Louis, Missouri, in a written statement. "The labor department takes seriously its responsibility to enforce the FLSA on behalf of vulnerable workers, and we will use all available tools, including litigation, to ensure workers receive wages that are rightfully theirs."

A third restaurant owned by the defendant was not involved in the action, according to the March 4 issue of the News-Gazette.

According to the DOL investigation, various violations in overtime laws, minimum wage and record-keeping protocols were found. The two restaurants involved were Mi Pueblito Restaurante Mexicano and Guadalajara Restaurant, both located in Decatur.

The DOL investigation determined that employees were paid less than the federal minimum wage, were paid less than the standard rate for overtime when work exceeded 40 hours per week (a violation of overtime labor laws), and that the employer failed to keep accurate and adequate pay records.

The defendant's attorney noted that according to his client, one of the issues pivotal to the investigation occurred when an employee already putting in hours at one restaurant, was summoned to take up duties at the second facility close by. Such cumulative hours were, according to the defendant, not tracked by accounting for that employee across both facilities.

The defendant embroiled in this overtime rules investigation also noted that some employees were, in the defendant's view, not familiar with the operation of a time clock. Fuentes' representative noted that once notified of the issue, the owner took steps to remedy the situation and purchased computers requiring any wait staff to check in, prior to commencing duties.

Nonetheless, the DOL determined a violation had occurred and ordered the $250,000 settlement. The payments will be made to affected employees by way of installments until the entire amount is paid, probably by 2015. It was not mentioned if interest payments were part of the plan.

A spokesperson for the Department of Labor noted that increased violations have forced the department to step up its oversight of the restaurant industry to enforce laws on overtime. In Illinois alone, the DOL recovered more than $500,000 on behalf of about 480 workers employed at more than 50 restaurants, due to various employment law overtime violations.

"These are some of the most vulnerable workers in America, and oftentimes they agree to a wage that isn't the federal minimum wage," Department of Labor spokesperson Rhonda Burke said. Regardless of whether or not an employee says he or she will work for a certain rate, "what matters is what the law states." Pay for overtime is a worker's right.