Liquidated Damages Award in FLSA Case Reminds Employers in New Jersey and Across the U.S. to Comply With Wage Laws

A federal court has ordered a restaurant company to pay a group of employees liquidated damages under the Fair Labor Standards Act (FLSA). In Dobson, et al, v. Timeless Restaurants, Inc. d/b/a Denny’s, a number of diner servers sued their employer for failure to pay unpaid minimum wages and overtime. According to the restaurants workers, they were required to participate in a tip pool that redistributed a portion of their earnings to other employees whose wages were not tip-based.

After a jury found Timeless Restaurants violated the FLSA, the court considered whether to award the workers liquidated damages. The employees argued that such an award was merited under the FLSA because the jury determined that Timeless acted willfully when it failed to pay wait staff minimum and overtime wages. Timeless, on the other hand argued that the jury’s determination was not determinative and the company “had reasonable grounds to believe that its acts or omissions did not violate the FLSA.”

According to the court, liquidated damages are not required under the FLSA if an employer who failed to pay a worker the appropriate wages acted in good faith. Still, the statute places the burden for demonstrating such a good faith belief on the employer. According to the district court, Fifth Circuit precedent states that an employer may not demonstrate it acted in good faith after a jury has determined the employer willfully violated the FLSA. As a result, Timeless was ordered to pay liquidated damages for its willful FLSA violations.

Next, the court turned to those FLSA violations the jury did not find willful. According to the court, Timeless’ evidence was insufficient to show the company reasonably believed it was in compliance with the statute. Additionally, the court said there was reason to believe much of the evidence offered to demonstrate that the company complied with the applicable minimum wage and overtime requirements was falsified. The court added that worker testimony during trial was more credible than that offered by Timeless. Because of this, the district court ordered Timeless to pay liquidated damages equal to the amount of damages awarded by the jury for the company’s non-willful FLSA violations.

This overall result was required by the FLSA. The law states that workers who sue their employer in order to recover unpaid minimum wage or overtime pay are entitled to receive twice the amount of pay unlawfully withheld by the employer if the employer fails to prove it had a good faith basis for believing it was in full compliance with the law.

Do not hesitate to call the Resnick Law Group, P.C. at 973-781-1204 or (646) 867-7997 if you believe you were unlawfully denied the right to receive at least minimum wage or overtime pay at a New Jersey or New York workplace. The hardworking employment lawyers at the Resnick Law Group represent current and former employees in both New Jersey and New York regarding matters that involve workplace rights violations. To discuss your situation with a knowledgeable advocate, please contact the Resnick Law Group through our website today.

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