Summary: When employers illegally deprive workers of overtime pay, workers have the right to seek backpay and additional damages under federal and state law. A recent example involving restaurant workers in California underscores this point. Do not wait to contact an attorney if you believe your employer is committing wage and hour violations.
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California workers have many rights as established by both federal and state law. Employees should be paid for all hours worked, and non-exempt employees should always receive overtime pay when they exceed a set number of hours in a given workday or workweek. The outrageous lengths some employers will go to in order to avoid paying overtime were highlighted in just one of many cases in the last few years.
This case involved 22 workers at a popular San Francisco restaurant. In 2021, following a lengthy investigation by the state’s Labor Commissioner, the owners of the restaurant agreed to pay a $1.6 million settlement to these workers in overtime and backpay compensation after having unjustly deprived them of their full wages for years.
California employees may file a wage and hour lawsuit against their employer for failure to pay overtime. If you believe your employer has violated state or federal overtime laws, you should consult with an attorney to better understand your rights and legal options.
The Story Behind a $1.6 Million Payout for Overtime
In 2019, the California Labor Commissioner launched an investigation into potential overtime violations at Z&Y Restaurant in San Francisco’s Chinatown. Workers at the restaurant asserted multiple, concerning allegations. These included:
- That the owners were paying kitchen staff on a fixed basis and servers on an hourly basis
- Wages were coming in below minimum wage standards and excluding overtime compensation
- The restaurant owners were illegally withholding tips from service staff
- The restaurant owners were not paying split shift premiums for workers who served in back-to-back shifts
The investigation concluded that these claims were true and that the restaurant owners were engaging in multiple illegal wage theft violations, including failure to pay overtime to non-exempt workers. In 2020, the Labor Commissioner determined that the restaurant must pay back wages and penalties totaling over $1.4 million.
While the restaurant appealed that decision, they subsequently reached a settlement of $1.6 million with the Commissioner’s office in 2021:
- Each of the 22 affected workers received an average settlement payout of $73,000, including post-settlement interest
- Five of the 22 workers also received an additional $70,000 due to workplace retaliation they experienced after asserting overtime violations, tip theft, and other forms of wage theft
Another example of overtime wage theft in California was highlighted in a 2023 case where the U.S. Labor Department recovered $1.6 million in backpay for 83 restaurant workers in Los Angeles who had been denied overtime. In this case, the employer had kept false records to try to obscure their wage theft. The Labor Department also imposed over $62,000 in financial penalties on the restaurant for their illegal pay practices.
Understanding California’s Overtime Laws
Overtime rules established by the federal Fair Labor Standards Act (FLSA) and California state law require employers to pay non-exempt employees for overtime when they exceed over 40 hours in a given workweek. State law also requires that non-exempt workers be paid overtime when they exceed eight hours in a single workday or work for the seventh day in a row in any given workweek. Here are some key points to keep in mind regarding California’s overtime laws:
- Overtime pay should equal 1.5 times the employee’s regular rate of pay
- When an employee works more than 12 hours in a given workday, California law requires that the employer pay them twice their regular rate of pay in overtime compensation
- Exempt employees are not required to be paid overtime, even when they exceed 40 hours in a workweek
- Exempt employees can include those in certain executive, administrative, or sales roles
Employers trying to illegally withhold overtime may misclassify a worker as exempt when they should be non-exempt. Other tactics like treating workers as independent contractors, forcing an employee to work off the clock or keeping an employee on call could be ways a company engages in unlawful overtime violations.
Contact a California Wage Theft Attorney About Suspected Overtime Violations
An experienced attorney can help you navigate the complicated legal process of filing a wage and hour dispute for overtime pay. The case of California restaurant workers winning $1.6 million in an overtime case is just one example of the blatant wage theft that occurs on a daily basis across industries, and what can be done about it.
Employees who are victimized by overtime violations or other forms of wage theft may need help from an attorney to hold their employer accountable and pursue justice by filing a compensation claim. If you have questions about an overtime dispute or suspected wage violation, do not hesitate to contact us today by chat or by filling out the intake form to obtain your free and confidential review.
