N.Y. Restaurant, Banquet Company Facing Unpaid Tips Lawsuit

A former waiter who worked as a banquet server for a New York restaurant and banquet company has filed a wage and hour class action lawsuit claiming that he and the other banquet servers had more than $1 million in tips withheld from their paychecks.

Plaintiff Ryan Picard worked for the Mallozzi Group beginning in 2011 and through 2012. He filed the wage and hour lawsuit in the Albany County Supreme Court in March 2013, saying that he and at least 100 other servers were wronged by the company’s practices.

The Mallozi Group owns and operates a banquet hall and hotel in Rotterdam, N.Y., a restaurant and banquet hall in Albany, N.Y., and food service operations at two golf courses as well as a bakery and restaurant in Schenectady, N.Y.

According to Picard, Mallozzi charges a “20 percent service personnel charge” to customers who rent out its banquet halls, but the servers never see any of that money.  He asserts that any “reasonable” customer would think the customer charge is a gratuity charge that will go to the servers.

Picard also claims that they were told by Mallozzi that if a customer asked the servers if they received tips, they were “to respond, as instructed by the defendants, that they did receive tips.”

However, Bobby Mallozzi, who owns The Mallozzi Group with his brother, John, said that the company has included that charge for years and that neither the word “tip” or “gratuity” has even been used. He also added that customers are also never told that the mandatory customer charge is for the purpose of paying the servers.

“We’ve done nothing wrong,” Mallozzi said. “We’ve been doing this for years. We did everything exactly the way we should have.”

He added that servers’ wages start at $12 per hour and go all the way up to $19 per hour, and the Mallozzi group makes it clear to their servers that their pay is based on a flat hourly rate, not tips.

This is apparently not atypical for banquet servers. Restaurant severs get paid minimum wage and collect tips. Banquet servers usually receive a flat hourly rate that is higher than minimum wage to make sure the servers are properly compensated for their work.

Picard’s wage and hour lawsuit cites a decision in the case of Samiento v. World Yacht, in which the appellate court concluded in 2008 that any “charge purported to be gratuity must be distributed in full as gratuities to the service employees or food service workers who provided the service.”

Picard is charging the Mallozzis with violating New York’s tip-appropriation law, which states that employers are not to “demand or accept, directly or indirectly, any part of the gratuities received by an employee, or retain any part of a gratuity or of any charge purported to be a gratuity for an employee.”

“By defendants’ knowing or intentional demand for, acceptance of, and/or retention of the mandatory charges paid by customers when contracting with defendants, when such customers were led to believe that such mandatory charges would be paid to plaintiff, defendants have willfully violated,” the New York law, the lawsuit states.

The plaintiff is represented by D. Maimon Kirschenbaum of Josephy & Kirschenbaum. The defendant is represented by John Bagyi of Bond, Schoeneck & King.

Free Help for Employees Seeking Unpaid Tips

If you were paid with a mandatory service charge within the past four years and believe it may have negatively affected your minimum wage or overtime pay, you have rights under federal wage and hour laws. Obtain a free case evaluation by filling out the short form at the Service Charge, Wage & Hour Class Action Lawsuit Investigation. One of the skilled employment lawyers working with Top Class Actions may be able to help you get the money you’re owed, at no out-of-pocket cost to you.