MADISON -- The U.S. Department of Labor has ordered 24 Madison-area restaurants and hotels to pay 275 employees more than $724,000 in back pay following an investigation into hours and wage violations.
The agency's Wage and Hour Division outlines a number of violations in a report, including employers paying servers in tips only, deducting the cost of uniforms and broken items from workers' pay, and paying overtime in cash at "straight time" rates.
Karen Chaikin, the regional administrator of the division in Chicago, said in a news release that hospitality industry workers are often vulnerable to exploitation.
"Language barriers, fear of retaliation and fears about immigration status can cause these workers to be among those least likely to speak up, leaving them vulnerable to exploitation," Chaikin said.
The largest violation comes from Laredo's Mexican Restaurant, which has three locations, the Wisconsin State Journal reported (http://bit.ly/1Oqyv9Y ). Investigators determined that 86 Laredo's employees are due a total of about $402,000. One of its owners told the State Journal he didn't know about the case. The paper wasn't able to reach another owner for comment.
The department has also ordered Cocina Real in Middleton, which has some of the same owners as Laredo's, to pay more than $118,000, total, to 27 employees.
Ed Lump, president and CEO of the Wisconsin Restaurant Association, told the Journal that his organization tries to raise awareness of the laws governing payments to employees but that restaurant owners are sometimes uncertain about the rules.
"We don't condone violations but there can be confusion in some cases in the differences between state and federal laws," he said.
