Aug 30

Ex-Workers File Putative Class Action Claiming Celebrity Wahlburgers Stole Wages 



NEW YORK – Five former workers filed a class action lawsuit last week against Wahlburgers restaurants and three of its franchisee entities and their officers, claiming widespread wage theft. The privately-held franchisor is owned and operated by actors and producers Mark and Donnie Wahlberg and their brother, celebrity chef Paul Wahlberg.

The Boston-based franchised company, founded in 2011 by the three Wahlberg brothers, is also the name of the A&E television reality series, now in its sixth season, that follows the Wahlberg family as they operate and promote their restaurant chain. The complaint states that the brothers pride themselves on taking an active role in managing their locations and insuring that their restaurants meet their high standards for customer and employee experience. Wahlburgers’ company slogan is “Our family, our story, our burgers.”

The Wahlburgers’ website boasts, “We are a working class organization, rooted at our family’s kitchen table where the only star is the food and the music is laughter and stories. We embrace loyalty, gratitude, excellence and community, sharing these values in our restaurants every day.”

The Wahlberg brothers, Mark, Donnie and Paul, are not named in the putative class action lawsuit.

The Class and Collective Action Complaint, filed August 18, 2016 in U.S. District Court, Eastern District, alleges the renowned New York Wahlburgers restaurant chain has been rampant with wage theft and violations of federal and state labor law since it began opening franchises throughout New York and Long Island. It asserts that when opening its first location in September 2015 in Coney Island, Wahlburgers “maintained a pattern and practice of regularly shaving compensable time from the weekly hours of all its non-exempt employees, including servers, bartenders, bussers, and kitchen staff, and paying them for significantly fewer hours that they actually worked.”

The court document also tells that Wahlburgers did not pay the non-exempt staff at the minimum wage rate for all hours worked and at overtime rates of one and one-half the regular hourly rate for all hours worked in excess of forty hours per week. And, Wahlburgers compensated its “tipped” employees at the tipped minimum wage rate of $7.50 per hour, without satisfying the strict requirements entitling Wahlburgers to apply a tip credit to the statutory full minimum wage rate.

The allegations continue stating that beginning in June 2016, the chain regularly paid several tipped employees a flat salary of $300 for all hours worked, including hours totaling over forty. “This payroll scheme is an obvious and willful avoidance of Wahlburgers’ obligation to pay one and one-half times the regular hourly rate for all hours over forty, as required by the Fair Labor Standards Act and New York Labor Law,” the complaint states.

The former employees also contend that when Wahlburgers obtained gratuities from customers for tipped workers, it also imposed an unlawful tip pool that allowed them to pay non-tipped kitchen employees out of those funds. And the workers claim they were never paid for attending mandatory meetings, and were never provided with accurate wage statements showing a breakdown of hours worked, wages and tips paid.

Wahlburgers, franchisee entities, accountable as joint employers

In addition to naming Wahlburgers Franchising, LLC in the lawsuit, three of its franchisee entities, Coney Burgers, LLC, Big Apple Burgers, LLC and WBDC, all located in New York State, were also identified as defendants.

Three officers of the franchisee entities, Mark Andrew Singer, John Cestare and Ben Niass, are also individually named in the class action, claiming they possessed operational control and policy making authority, and had ownership interest over the Wahlburgers’ franchised businesses. Because the franchisee officers had the authority to hire and fire employees, establish pay practices and scheduling, control labor relations and personnel policies, determine terms and conditions of employment, and maintain employment records, the lawsuit alleges they are “personally, jointly, and severally liable for violations of the Fair Labor Standards Act and New York Labor Law.

Because all three, Wahlburgers Franchising, the franchisee entities and the officers of those companies, all acted directly or indirectly in the interests of one another in relations to the former employees and similarly situated employees, the complaint asserts that they are joint employers over the workers.

New York attorneys Mitchell Schley and Louis Pechman, representing the five Wahlburgers former employees, filed eight claims against the Wahlburgers defendants. They include violations of the Fair Labor Standards Act and New York Labor Law for failing to pay the required minimum wage and overtime. Other claims are for violations under the Wage Theft Prevention Act, the Spread-of-Hours Pay, Misappropriation of Gratuities, and Unlawful Deductions from Wages.

The former employees in the suit bring two claims, under NLSA for unpaid minimum wage and unpaid overtime, as a collective action for themselves and for other non-exempt employees of Wahlburgers, including cooks, runners, expeditors, dishwashers and porters, at any time three years prior to the filing of the complaint. It consists of approximately one hundred current and former non-exempt employees of Wahlburgers.

The lawsuit asks for class certification, and for damages, liquidated damages, pre-judgment and post-judgment interest, and award for attorneys’ fees and costs.

People magazine reported on the litigation last week, saying the Wahlburgers chain has launched an investigation into the Coney Island franchise where the alleged claims of wage theft began. A spokesperson said in a statement, “Wahlburgers is all about family. Treating people fairly and with respect is at the heart of our brand. Since this situation came to light yesterday, we’ve been working with Coney Burgers to better understand the circumstances.”

The Coney Burgers franchise company also issued a statement, saying, “As a franchisee, we work hard to uphold Wahlburgers’ values and brand culture. We’ve become aware of dissatisfaction of some of our former employees and are now looking into the matter.”

Source: Ex-Workers File Putative Class Action Claiming Celebrity Wahlburgers Stole Wages | BlueMauMau, Franchise news for franchisees

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