A federal investigation found a Central Texas food chain violated a year-old law by reallocating $230,353 in tips from servers to managers, taking away earned wages of more than 270 employees – the US Department of Labor announced Monday.
Several Black’s Barbecue locations in Austin, New Braunfels, Lockhart and San Marcos were targeted by the Labor Department’s Wage and Hour Division investigation as a result of a 2019 audit and a change in federal labor rules that would make it illegal to share tips with employee earned with administrative staff.
Kent Black, grandson of original Black’s Barbecue pitmaster Edgar Black Sr. and today a member of the Black’s property group, the Statesman, part of the USA TODAY Network, told Tuesday that the company outsourced their wages and was not aware of the rule version that managers should not take tips.
“We’re barbecue experts, we’re not payroll experts,” Black said. “We didn’t follow that closely, and apparently our payroll company didn’t pick up on that.”
The Labor Department said Monday that the illegally shared wages had been recovered.
“Food service industry employers need to know that tips are the property of tipped employees who earn them, plain and simple,” said Austin Wage and Hour District Director Nicole Sellers. “Workers and their families depend on their rightfully earned wages and benefits. When youare take from them, you are taking from their families.”
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In 2018, legislative changes to the Fair Labor Standards Act made it illegal for employers to keep tips from employees under any circumstances. The changes were then introduced by the Labor Department in 2020 before taking effect in April 2021.
Black said Monday’s announcement was unexpected because the federal investigation into the company and talks with the Labor Department began in 2019.
He said that in 2021, his barbecue namesake returned the misallocated tips that had been distributed with managers at four of the chain’s locations.
The back pay amounted to about 10% of what employees were originally supposed to be paid under the updated federal guidelines, Black said.
“We’ve been around for 90 years, we pay our taxes, we pay our staff, we try to be good citizens. So, we immediately changed the way we allocate these tips without them asking us to do it,” said Black.
So far this year, the Wage and Hour division has identified $35 million in back wages affecting approximately 29,000 workers.
Over the past decade, the department’s records show that the food service industry is one of the most consistent “high violation” wage environments for workers, along with construction, both of which take in tens of millions annually. lose wages.
Employees who feel they may be owed wages are asked to use the labor department’s search tool and search for the name of their company.