A distillery in Pittsburgh has paid back US$38,951 in wages to 41 workers after using its tip pool illegally.

A tip pool means that a portion or all of the tips collected in an evening are redistributed among staff, as opposed to each server keeping the tips they earn individually.

Pittsburgh Distilling Co, doing business as Wigle Whiskey, was accused of violating the Fair Labour Standards Act (FLSA) by the US Department of Labour’s (DOL) Wage and Hour Division.

The employer has been found to have wrongfully allowed managers to receive tips earned by servers, and short-changed tipped employees of overtime wages.

Investigators found that Wigle Whiskey paid an overtime rate of US$4 per hour, rather than US$7.25 per hour as federal law requires.

“Food service workers rely on their hard-earned tips to make ends meet,” said Wage and Hour Division district director John DuMont in Pittsburgh.

“Restaurant employers must understand that keeping workers’ tips or diverting a portion of these tips to managers or supervisors in a tip pool is illegal.

“As restaurants struggle to fill the positions they need to keep their doors open, those who deny workers their rightful wages are likely to find it more difficult to retain and recruit workers than those employers who abide by the law.”

The FLSA allows employers to pay tipped workers US$2.13 per hour in direct wages, as long as a credit of US$5.12 is provided in tips to make up the basic combined cash and tip minimum wage rate of US$7.25....

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