World of Beer to Face N.J. Wage and Hour Lawsuit

A sports bar in New Jersey is facing a wage and hour class action lawsuit from a former employee, who alleges the bar shorted him and other employees on their wages.

Plaintiff James Gerard says he worked for World of Beer in New Brunswick from August 2012 through May 2015. James claims that while he worked as a server and bartender, World of Beer paid him $2.13 per hour for the first 40 hours he worked each week and nothing for any hours worked over 40. He says that World of Beer used a “tip credit” to keep employees’ net wages low, allegedly well below the applicable minimum wage.

World of Beer did not tell employees how that tip credit would be applied, James claims. The wage and hour class action lawsuit also alleges that when employees’ compensation from wages and tips failed to meet the minimum wage, World of Beer did not make up the difference.

Employees were also expected to perform duties not directly tied to tips while earning the lower tip-earning wage, James alleges. These duties included cleaning bathrooms, mopping floors, cleaning windows, and taking out the garbage.

James claims that the wage shortages continued even after a promotion. His wage and hour class action lawsuit alleges that when he was later promoted to product manager, World of Beer paid him only $400 per week, a salary still below the minimum wage.

James is seeking compensation for unpaid wages for both regular time and overtime. He filed this wage and hour claim as an employment class action lawsuit in hopes of getting compensation for other World of Beer employees who have been similarly mistreated.

World of Beer is a nationwide chain of sports bars with about 70 locations across the country.

The Federal Fair Labor Standards Act

The federal Fair Labor Standards Act governs many of the employment claims in James’s wage and hour class action lawsuit. While the FLSA sets a national minimum wage (currently $7.25 per hour), it allows employers to pay tipped employees less than the minimum as long as the employees’ total compensation, including both wages and tips, reaches the minimum hourly wage for each hour worked.

New Jersey, where James worked for World of Beer, has a similar legal provision, but places no additional restrictions on hourly wages for tipped employees. The state recommends a minimum wage of $2.13 for tipped employees, but as long as the employee’s compensation reaches the state minimum wage ($8.38 per hour, as of January 1, 2015), employers can set the wage however they want.

Both the FLSA and New Jersey employment law require overtime compensation for hours worked in excess of 40 in a given week. The FLSA requires the employer to add a 50 percent premium to the hourly wage for each hour of overtime worked, resulting in an overtime wage commonly referred to as “time and a half.”

There are exceptions to overtime protection for certain types of jobs, however. Probably the most commonly invoked exception is that for certain executive, administrative, and professional employees paid on a salary basis instead of an hourly wage. Such jobs are typically designated “exempt.” Employee misclassification may itself be the subject of a wage and hour lawsuit.

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