Harvard Univ. Wait Staff File Service Charge Class Action Lawsuit

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Service charge lawsuits are becoming one of the biggest sources of wage and hour litigation, with thousands of service workers alleging their payments are being undercut. However, it is not just hotels and restaurants involved in these legal woes. In 2012, Harvard University faced its own lawsuit brought about by its wait staff.

In September 2012, U.S. District Court Judge Douglas P. Woodlock ruled in favor of a punitive class action lawsuit, brought by the service staff of the Harvard Faculty Club.  Earlier it had been improperly transferred to federal court in a movement by the defendant, but was corrected.  Harvard University argued that the complaint had accused the university of improperly distributing proceeds from service charges under the federal Labor Management Relations Act. Woodlock disagreed and kept the lawsuit in Massachusetts state court.

At this time, Massachusetts is one of the only states in America which specifically requires a restaurant, hotel, or any other kind of establishment that provides service to explicitly state that service charges do not tip the waiting staff.  Instead, the services charges typically go to management. Other states that have this policy include Hawaii, New York and Washington.

Harvard University Faculty Club allegedly violated Massachusetts law by not distributing the service charge wages to the serving staff, and even holding off on the actual tipping. Angel Hernandez has been the lead plaintiff for the wait staff since the class action lawsuit began, and is happy with the outcome so far in the case.

According to Hernandez, the collective agreement between the wait staff and the faculty club was that the wait staff would work but stay quiet on the issue of tips and gratuity charges. Faculty club patrons were allegedly told not to tip the servers, and the wait staff was reportedly not permitted to keep any money as tips. Instead, the patrons are charged 18 to 22 percent of their additional overall purchase, but allegedly none of these surcharges are provided to the wait staff.

Harvard argued that this actually was a positive arrangement for the wait staff because they were unionized. However, Woodlock rejected Harvard’s justification because the servers were reportedly asked to keep silent, which implied that Harvard was aware of the service charge violation. According to Hernandez, Harvard had tried to use that collective agreement to say that the servers had agreed not to sue the university. Harvard has tried several other times to dismiss the case, but Woodlock has denied each motion.

Woodlock found that the university had put surcharges on food and beverage sales without any disclaimers, and did not inform patrons that the service charges did not go to the wait staff.  Harvard countered that their wait staff had been paid more than double than the average restaurant server.

Hernandez contradicts this point, stating that he has been employed at the Harvard Faculty Club since 1999, and under the terms of the collective bargaining agreement, had been paid a flat-hourly rate that certainly did not meet Harvard’s described numerical.

A class action settlement was reached in 2012, with Hernandez and his fellow servers winning the lawsuit. Harvard paid $4 million to settle the class action lawsuit.

This Harvard service charge lawsuit is Angel Hernandez v. Harvard University, Case No. 1:12-11978-DPW, in the U.S. District Court for the District of Massachusetts.