Widespread violations of the Fair Labor Standards Act’s minimum wage and overtime provisions have been found during an ongoing enforcement initiative conducted by the Department of Labor Wage and Hour Division’s Tampa office.  The initiative focuses on full-service restaurants and is being conducted in conjunction with the Florida Department of Business and Professional Regulation Division of Alcoholic Beverages and Tobacco, according to a statement released by the Wage and Hour Division on March 19, 2013.

According to the report, during 2012, the division’s Tampa office conducted more than 80 investigations of restaurants, resulting in nearly $500,000 in minimum wage and overtime back wages, as well as additional liquidated damages and civil money penalties, for more than 800 employees. The report cautions that investigators from the division’s Tampa District Office will continue to make unannounced visits to full-service restaurants to assess compliance with all labor standards. During 2012, the most common violations found included: requiring employees to work exclusively for tips, without regard to minimum wage standards; making illegal deductions from workers’ wages for walkouts, breakages and cash register shortages, which reduced wages below the required minimum wage; and incorrectly calculating overtime for servers based on their base rate before tips, instead of the correct minimum wage.

The report states that, during 2013, if violations are found, the division will pursue back wages, civil money penalties and liquidated damages.  This is a more aggressive approach than  in the past, when, although liquidated damages are a statutory remedy, only back wages would be sought to resolve violations.

Florida employers should bear in mind that although the FLSA minimum wage for non-exempt employees is $7.25 per hour, the Florida minimum wage is $7.79 per hour. However, employers of “tipped employees,” who meet the eligibility requirements for the tip credit under the federal Fair Labor Standards Act (generally, they are able to keep all their tips and receive more than $30 per month in tips), may pay such employees a different direct wage. Such employers are allowed to claim a “tip credit” toward fulfilling the minimum wage requirements, whereby tips satisfy a part of the employer’s obligation to meet the minimum wage. The direct wage that must be paid to “tipped employees” is calculated as equal to the minimum wage ($7.79) minus the tip credit allowed under Florida law ($3.02), which equates to a direct hourly wage of $4.77 as of January 1, 2013. This is an increase from $4.65 per hour in 2012. If an employee’s tips combined with the employee’s direct wages do not equal the minimum wage, the employer must make up the difference. Employers also are required to provide employees notice of the tip credit provisions and to maintain accurate time and payroll records. Finally, employees must be compensated at time and one-half their regular rates of pay for hours worked beyond 40 per week

Given the increase in enforcement initiatives and penalties, it is especially important for restaurants, as well as all employers, to ensure compliance with the requirements of wage and hour law.