Doubletree Continues to Face OT Class Action Lawsuit

A federal judge is choosing to keep an OT class action lawsuit against DoubleTree LLC in which banquet servers claim that the hotel chain did not pay them proper overtime.

New York U.S. District Judge Kenneth M. Karas has refused to eject this OT class action lawsuit, stating that the plaintiffs proved that Doubletree LLC was their employer citing the Fair Labor Standards Act. 

Judge Karas did not accept the Doubletree LLC opinion that it hired banquet servers as independent contractors over which DoubleTree had no control or that the franchisee itself was an independent contractor.

He ruled that the plaintiffs including the Tarrytown, New York franchisee merely had to prove that DoubleTree LLC was their employer.

To qualify under New York state law and under the FLSA, this was all that was necessary in this OT class action lawsuit.

In their second amended complaint, the workers proved that DoubleTree LLC had at least functional control over the franchisee. Judge Karas said that DoubleTree had influence over the operations of the franchisee. This included the right to inspect the hotel at any time.

The judge also said that DoubleTree LLC had control over the record-keeping standards of the franchisees as well as the type of software each hotel used.

Because of this, the OT class action lawsuit claims, the workers and franchisee fall under “employee” status.

The judge stated in the OT class action lawsuit opinion, “In this action, the ‘economic realities’ as pled by plaintiffs plausibly support an inference that franchisor defendants exerted control over hotel employees. Indeed, many of the second amended complaint’s allegations mirror those found by other courts to be suggestive of joint employer status.”

In other words, the plaintiffs were able to plead a case that supported the claim that the franchisor (DoubleTree LLC) exerted enough control over the workers to create the employee status.

The OT class action lawsuit complaint stated that the franchisee told the workers that it was DoubleTree hotel policy to not pay workers overtime if they worked over 40 hours per week.  This is in violation of both New York state laws as well as the Fair Labor Standards Act.

Additionally, the workers claim that there was an unfair issue with gratuity. They claim that they received tips from a pooled fund that collected the 12% gratuity fee that hotel guests were charged.

According to this OT class action lawsuit, the workers allege that they did not receive the full amount of tips owed them and that they were not notified properly of this procedure for tipping. This is in violation of state laws.

The plaintiffs also claim that the hotel did not inform them that an 11% service charge would not be paid to servers.

Allegedly, the hotel’s banquet director, Norma Abdou also sought gratuity from guests and told them the tips would be shared with the servers as well. However, she kept these tips for herself according to the OT class action lawsuit.

The judge partially certified a class of non-exempt workers from the hotel in March of this year. These workers included workers who were employed in the food and beverage and housekeeping departments. They also must have worked there in the six years prior to their filing suit in December 2014

One of the attorneys for the class was quoted as saying, “We are very pleased with the court’s decision and intend to vigorously pursue our claims against the franchisor defendants on behalf of the numerous employees whom we represent in this case.”

The DoubleTree OT Class Action Lawsuit is Carlos Ocampo et al. v. 455 Hospitality LLC et al., Case No. 7:14-cv-09614, in the U.S. District Court for the Southern District of New York.

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