Don’t Drink the Tea. Think With the WE.
Apr
2016
22

Unholy Mole: SC Restaurant Chain to Pay $1.2M in Backpay, Penalties for Years of Wage Abuse

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A judge has ordered the owners of the La Hacienda restaurant chain to pay a whopping $1,179,045 in back wages and penalties to 119 employees that the company systematically cheated out of wages between 2011 and 2014.  In his ruling, Judge C. Weston Houck also forced the company to formally acknowledge that they will face contempt charges if they commit labor law violations in the future.  

The case stemmed from an investigation by the U.S. Department of Labor’s Wage and Hour Division which found multiple violations of the Fair Labor Standards Act (FLSA) at the company’s 10 South Carolina locations.  Violations were also found at Los Jalapenos Mexican Grill in Hilton Head, Poblanos Mexican Cuisine in North Charleston, and Margaritas Mexican Restaurant in Summerville.

The DOL investigation also found that the company failed to keep proper records of hours worked; failed to pay cooks, dishwashers, and runners for all hours worked; and failed to pay for employees’ uniforms.

Jamie Benefiel, Director of the Wage and Hour Division’s Columbia office, sees the problem as endemic:

“Our investigation of these 13 Charleston-area restaurants found many low-wage employees working long hours without any overtime compensation and, at times, earning wages far below the federal minimum wage.  Labor violations like these are unfortunately all too common in the restaurant industry.”

The case originally revolved around the company forcing workers to give portions of their tips to management. In South Carolina, as in many states, the tipped minimum wage is $2.13 an hour.  If an employee is forced into a tip sharing scheme, they are entitled to a minimum wage of $7.25.

Sadly, this is not the first violation against the owners of the company:

Ayala’s father, Jesus Ayala, in 1991 opened the first La Hacienda in Greenwood. The company had grown to 10 Lowcountry locations by 1998, when two of its managers were charged with crimes related to the employment of about 100 people accused of entering the country illegally. The government claimed La Hacienda illegally paid some of those employees in cash or forced them to work exclusively for tips.

Financial awards to workers will range from $54.66 to $61,089.06, depending on the number of hours worked.  Employees will be eligible to receive their back pay no matter their citizenship status.  

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