Court Sides With Restaurants Against Servers In Arizona Wage Dispute

 

Via azcentral.com

Arizona restaurant owners aren’t required to pay full minimum wages to waiters, waitresses or bartenders, even at times when such workers are occasionally performing tasks that don’t generate tips, a court has decided.

The 9th U.S. Circuit Court of Appeals, in an opinion filed Wednesday, held that restaurants don’t need to separately track the types of tasks performed by servers and bartenders minute by minute, and thus don’t need to pay separate minimum wages. Restaurants generally pay lower minimum wages to employees who earn tips.

“This decision relieves companies from the burden of creating and managing timekeeping records based on tasks performed, such as rolling silverware into napkins versus serving food to a customer,” said David Selden, an employment attorney with the Cavanagh Law Firm in Phoenix.

Requiring employers to track the time employees spend serving customers, as opposed to wiping tables and other tasks, would have been impractical, he added. Selden helped argue the case on behalf of employers in San Francisco in April.

The case stemmed from a complaint brought in 2014 by Alec Marsh, who worked as a server at a J. Alexander’s restaurant in the Phoenix area from November 2012 to April 2013. Along with serving food to customers, Marsh occasionally brewed tea and coffee, cut lemons and limes, cleaned soft-drink dispensers, wiped tables, took out trash, scrubbed walls, cleaned restrooms and performed other tasks.

The case, Marsh vs. J. Alexander’s LLC, incorporated complaints from 13 other Arizona servers and bartenders who worked for companies such as International House of Pancakes, Arriba Mexican Grill, AMC Theatres Esplanade 14, P.F. Chang’s China Bistro, American Blue Ribbons Holdings and Denny’s. The court’s decision applies to businesses operating in the nine Western states covered by the 9th Circuit, not just Arizona, Selden said.

Restaurants may pay a lower hourly minimum wage to servers who earn tips. As noted by the court, an employer must pay a tipped employee a cash wage of at least $2.13 but can make up the difference between that and the federal minimum wage of $7.25 by claiming a credit for tips earned by such workers.

“If the $2.13 cash wage plus the tips the employee actually received are insufficient to meet the $7.25 per hour minimum wage, then the employer must increase the cash wage to meet the minimum-wage requirement,” wrote Circuit Judge Sandra Ikuta. “As a result, tipped employees always earn at least the federal minimum wage.”

Arizona’s minimum wage isn’t identical to the federal minimum wage and wasn’t when the cases were filed, but the court called the differences immaterial for its opinion.

In the cases filed under Marsh vs. J. Alexander’s LLC, the various waiters, waitresses and bartenders argued that they were entitled to the full minimum wage, with no tip credit applied, if they spent more than 20 percent of their working time on side duties such as rolling silverware into napkins, brewing coffee, cleaning restrooms or emptying trash.

According to Selden, the servers essentially argued that they were engaged in dual occupations, for which employers should track their time based on the tasks performed, with full minimum wages owed for tasks that weren’t tip-related or primarily not tip-related.

The court found in favor of the employers, dismissing the claims of workers. It concluded that servers can’t claim to be engaged in dual jobs if performing side tasks or even unrelated tasks occasionally throughout the day.

But the court left open the question of whether workers could claim dual jobs if performing general maintenance or other non-tip tasks for an extended period.

According to the court opinion authored by Ikuta, “If the employer has hired a person for one job (such as waitress or counterman), but that job includes a range of tasks not necessarily directed towards producing tips, the person is still considered a tipped employee engaged in a single job so long as the person customarily and regularly receives at least $30 a month in tips.”

 

 

 

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