Restaurants to pay out $2.4 million in class action regarding employee pay.
A $2.4 million class action settlement in a lawsuit filed against Tom Douglas and his restaurants was recently approved by a King County court. The case was filed on behalf of more than 1,300 current and former employees of Douglas’ with the lead plaintiff Clare Thomas taking the charge. Thomas is an ex-employee for the gastropub Brave Horse. The case alleged Tom Douglas’ company “failed to properly disclose where the money from service charge fees was going after it eliminated tips in early 2016 and did not provide adequate rest and meal breaks.”
Douglas’s many restaurants, which include the Dahlia Lounge and the Carlisle Room, were among those that changed over to a flat service fee rather than allowing for tips when the city’s $15 minimum wage laws went into effect back in 2016. Washington law requires that restaurants disclose to customers what percentage of that fee is going to the employees, and this was not happening.
The original complaint was filed in King County superior court in December 2018 and claimed the defendants, including Douglas, the Brave Horse Tavern’s parent company, Terry Avenue, Inc., and Tom Douglas Seattle Kitchen “did not disclose in menus and itemized receipts provided to customers the actual percentage of the automatic service charge that was paid directly to the employee or employees serving the customers.” Thomas also claimed her employer failed to “affirmatively provide her with ten-minute rest breaks for every four hours of work, regularly required her to work more than three consecutive hours without a rest break, and didn’t provide full, uninterrupted 30-minute meal breaks.”
Thomas explained, “I brought this lawsuit to try to change the culture in restaurants, ensure transparency regarding distribution of service charges, and seek fair pay.”
Douglas has denied any wrongdoing. He said, “We worked diligently with legal counsel and the Office of Labor standards to craft our service charge-distribution language and policy, all the while making sure our team remained compensated at historic levels. Our company has a clear and legal rest-break policy, formerly adopting the allowed intermittent break practice that allows employees to take multiple short breaks throughout a shift as needed. For the sake of clarity and assurance of the breaks regularly occurring, we moved to a more structured practice of daily recording that breaks did occur.” The new structure involved employees affirming to supervisors daily that they have taken their allotted breaks.
Under the settlement, Douglas will pay $2.4 million and will provide an additional $200 gift card to every past and present employee in the lawsuit. The settlement also requires that the restaurants maintain a confidential hotline for employees to call and voice any concerns as well as provide employment rights training to all supervisors.
According to a spokesperson for Tom Douglas Seattle Kitchen, this line was officially instituted in August of this year and more than 90 percent of supervisors have completed the first round of rights training to date, with further rounds to take place in the coming months. The settlement funds are set to go out toward the middle-to-end of December.