TGI Fridays Wage and Hour Settlement Proposed for $19M

A Class of nearly 30,000 workers for the popular restaurant chain TGI Fridays is expected to benefit from a proposed TGI Fridays wage and hour settlement, recently submitted to a New York federal court for approval.

The putative Class of 28,800 TGI Fridays employees who worked for wages that included tips alleged that TGI Fridays violated numerous state and federal wage statutes. If approved by the court, the TGI Fridays wage and hour settlement that was reached would total more than $19 million.

The allegations against TGI Fridays made by the Class of employees include claims that the restaurant owners inappropriately took a “tip credit” from their paychecks while paying them a reduced minimum wage.

Further claims include restaurant owners failing to pay employees overtime owed to them and not reimbursing them for expenses related to their uniforms. Additionally, Class Members assert that some tips were misappropriated and unlawful deductions were taken for customer walkouts.

The Class Members would get a pro rata share of the TGI Fridays wage and hour settlement based on the amount of hours they worked during the proposed class period.

The TGI Fridays wage and hour settlement for $19.1 million that was recently reached in this case included an award of $6.36 million going to class counsel. This amounts to about one-third of the entire TGI Fridays wage and hour settlement.

According to the plaintiffs’ memo filed in support of the settlement, “[t]he settlement, if approved, will eliminate the risk and delay of years of further litigation and put money in the hands of the low-wage workers who earned it.”

This proposed TGI Fridays wage and hour settlement will settle claims that span nine different states and over 12 lead plaintiffs. These plaintiffs, from California, Colorado, Connecticut, Florida, Illinois, Maryland, Michigan, New Jersey and New York, allege that the popular restaurant chain violated the Fair Labor Standards Act.

Under the proposed TGI Fridays wage and hour settlement, two Classes are asked to be certified. One Class includes tipped workers from one of the previously mentioned nine states who did not file consent to join the case in a timely manner, and the other class encompasses tipped employees who did file a written consent to join the putative class.

Interestingly, the proposed TGI Fridays wage and hour settlement only covers a small fraction of the possible estimated wages under dispute. The value of unpaid wages in this case, according to the memo, range from $16.5 to 91 million. This proposed TGI Fridays wage and hour settlement only covers between 20 percent and 115 percent of the possible wages, according to the plaintiffs.

The court memo goes on to state, “While plaintiffs submit that such a settlement is an excellent result, in applying the standards for approval, there is nothing inherently suspect about a class action lawsuit that achieves a 20 percent recovery for class members.”

This TGI Fridays Wage and Hour Settlement is Case No. 1:14-cv-02740, in the U.S. District Court for the Southern District of New York.

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