Ocean City Today

Fat Daddy’s, workers reach $260K settlement

About $50K will go toward lawyer fees, remainder split between 25 employees
By Brian Gilliland | Oct 05, 2017

(Oct. 6, 2017) U.S. District Court Judge Richard Bennett approved a joint motion for settlement in the class action of 25 former Fat Daddy’s employees and the employer late last month, bringing the case to a close by awarding more than $214,000 to the plaintiffs.

The average settlement amount was about $8,600 per employee, with the lowest award at $100 and the greatest in excess of $34,000. Lawyer’s fees were set at $50,000, according to the agreement.

Two former employee’s claims were dismissed after analysis showed they had not incurred any damages.

Part of the settlement stipulates there is no finding of fault within the agreement.

According to the settlement agreement, the dispute contained two kinds of plaintiffs: hourly kitchen workers, who alleged they worked more than 40 hours per week and were not paid overtime, and tipped workers, who also contended they worked more than 40 hours per week without overtime and were also occasionally required to perform non-tipped work at a rate less than the required hourly minimum wage.

During the discovery phase of the case, other issues arose, and were disputed by the defendants.

The investigation found that “nearly all workers had deductions from pay to cover the cost of uniforms or other miscellaneous deductions, which were not consented to in writing and could have potentially reduced wages to less than the required minimum.” The defense, in turn, argued that the deductions were proper and had no impact on the minimum rates.

Two workers alleged their hourly rate was reduced after the work had been performed without previous notice, which the defense explained as a one-time mistake.

Six plaintiffs claimed they were hosted by Fat Daddy’s as part of the J-1 visa program and paid more than $1,000 for airfare, recruitment fees and visa expenses to assume jobs at the restaurant. The defense’s reply to this allegation was “the legal authority regarding the payment of a foreign worker’s travel expenses to the U.S.” and back is not applicable to the J-1 program. All six were awarded $1,000 as a part of the settlement to cover these costs.

The terms of the settlement included four parts, including the J-1 reimbursement to the applicable plaintiffs.

The plaintiffs were awarded three times the alleged amount of unpaid overtime, calculated using a bi-weekly 80 hour standard, the amount of unpaid minimum wage multiplied by 2.33 using the same standard and a 100 percent reimbursement for deductions the plaintiffs believed were improper.

The lead plaintiff, Brandon Ware, was also awarded an additional $1,900 for expenses, because he had turned down an earlier deal that was worth more than what was agreed to in this settlement.


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