Feds: 7 Ann Arbor restaurants to pay workers back wages

David Shepardson
Detroit News Washington Bureau

Washington — The U.S. Labor Department said Monday that seven Ann Arbor area restaurants failed to pay proper wages to more than 100 workers — and will pay $145,600 in back income.

The Labor Department has an ongoing enforcement effort that began last year to ensure that businesses in Midwest college towns are complying with the Fair Labor Standards Act. The government said that in college towns “students, temporary workers and immigrants often fill hospitality industry jobs. Many of these workers are new to the workforce, unfamiliar with wage laws and their rights, and vulnerable to labor violations by employers, who hire some of the nation’s lowest-paid workers.”

“By illegally underpaying these people, employers cheated already low-paid workers and their families out of their hard-earned income. That is unacceptable,” said Karen Chaikin, regional administrator for the Wage and Hour Division in Chicago. “Unfortunately, labor violations like these are common in the restaurant and hotel industry. Our agency is committed to protecting workers from illegal treatment and ensuring that responsible employers, who abide by the law, don’t suffer because others violate it.”

The Labor Department said investigators found violations in Ann Arbor at: Tomukun Korean Barbeque, Holiday’s Restaurant, La Marsa Mediterranean Cuisine, Ahmo’s Gyros & Deli, Uptown Coney Island, Uptown/Main Street Coney Island & Restaurant, and Gourmet Garden.

All of the restaurants have agreed to pay back wages owed to the employees and will comply with the law going forward.

The Labor Department has open investigations into restaurants and hotels in Ames, Iowa; Bloomington, Indiana; and the twin cities of Bloomington-Normal, Illinois.

In the Ann Arbor cases, investigators found violations of overtime, minimum wage and record-keeping provisions.

“We are pleased to secure back wages for so many workers,” said Timolin Mitchell, director of the division’s Detroit District Office. “Using all the enforcement tools at our disposal, we can hold employers accountable and deter future violations. For workers, we will ensure a fair day’s pay for a fair day’s work.”

Federal law requires that most employees be paid at least $7.25 per hour for all hours worked, plus time and a-half regular rates for any others after 40 in a week.

An employer of a tipped employee must pay at least $2.13 an hour in direct wages, provided that amount plus the tips received equals at least the federal minimum wage of $7.25 per hour. If an employee’s tips and direct pay do not equal the minimum wage, the employer must make up the difference.