Company resolves Department of Labor allegations it made servers pay to work

In a consent agreement with the United States Department of Labor, the owners of Sophia's House of Pancakes must pay $245,000 in back wages and damages to employees for requiring servers to pay $2 an hour to work, according to a press release from the agency.

The US Department of Labor's Wage and Hour Division says Sophia's House of Pancakes restaurants in Kalamazoo and Benton Harbor required its servers to pay $2 an hour from their tips to their employer.

The investigation also found Peter Philis, who runs the Benton Harbor location, discriminated against a server claiming she reported violations of the Fair Labor Standards Act to the Department of Labor, according to a release from the department.

The agreement requires the owners of Sophia's LLC in Kalamazoo and Sophia's III in Benton Harbor to pay $122,500 in back wages and $122,500 in liquidated damages to 73 employees of the Kalamazoo location and 45 employees of the Benton Harbor location.

The owners have been identified as John P. Filis and Peter P. Philis.

Investigators say servers were required to pay the employer $2 an hour from their tips without a tip pooling arrangement in place.

In addition, the company is accused of

  • Failing to pay servers for time spent working before and after their scheduled shifts.
  • Taking deductions from employees’ pay for uniforms or incorrect orders, causing their hourly rates to fall below minimum wage.
  • Failing to accurately record daily and weekly work hours and earnings.
  • Paying kitchen staff flat salaries without regard to the number of  hours they worked, resulting in violations of the overtime regulations when these employees worked over 40 hours in a workweek and were not paid overtime.
  • Discriminating against a worker whom the employers blamed for calling the Department of Labor to complain about the restaurant’s pay practices.

The agreement with the Department of Labor requires Filis and Philis to

  • Install a computer or point-of-service system that records hours worked and permits servers to self-report tips received;
  • Provide every current and future employee with a Wage and Hour division “Work Hours Record keeper” publication they can use to track their hours;
  • Provide a complete wage statement to each employee each pay period, showing all hours worked, rate of pay, gross pay received, the nature and amount of all deductions,  net pay, the pay period covered by the payment, and a copy of the employee's record of hours worked.
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