Ann Arbor restaurants’ operator agrees to pay $197K in back wages, damages to 20 workers denied overtime during pandemic

ANN ARBOR, MI – An Ann Arbor restaurant operator who sought and received nearly $950,000 in federal assistance to help keep workers employed during the pandemic has agreed to pay $196,531 in back wages and liquidated damages to 20 employees after a U.S. Department of Labor investigation into the employer’s illegal pay practices. 

A consent order and judgment entered June 14, 2024, by the U.S. District Court for the Eastern District of Michigan, resolves allegations made by the department against Adam Baru, owner of Cascabel Ventures LLC, in a September 2023 lawsuit to recover back wages and liquidated damages and obtain an injunction against Baru and his restaurants to prevent future violations of the Fair Labor Standards Act.

An investigation by the department’s Wage and Hour Division found that — from Sept. 21, 2020, to July 3, 2022 — Baru as joint operator of Isalita and Mani Osteria & Bar failed to pay workers overtime at time and one-half their regular rate of pay for hours over 40 in a workweek.

During litigation, Baru admitted to accepting a loan from the U.S. Small Business Administration’s Paycheck Protection Program; public records indicate the two restaurants received $942,736 in February 2021. The restaurants’ owner also told the court he created a payment system that did not combine hours employees worked at both restaurants to ease the company’s financial burden during the pandemic and keep his businesses open and his employees working. The division determined that, despite benefiting from the PPP loan, Baru did not begin paying overtime properly until the division’s investigation began. 

“Regardless of their cause, economic downturns do not excuse an employer’s obligation to pay full and legally earned wages to employees or to comply with federal wage regulations,” said Wage and Hour Division District Director Timolin Mitchell in Detroit. “The Wage and Hour Division is committed to holding employers who violate federal labor laws accountable and prevent them from gaining a competitive advantage over employers who play by the rules.”

As part of the consent order, Baru and Cascabel Ventures have also agreed to pay $10,069 in civil money penalties assessed by the department. The court also granted the department’s request for an injunction forbidding the employer from future violations.

“We encourage employers and workers to contact the Wage and Hour Division with questions about complying with federal law and get the guidance they need to avoid costly violations,” Mitchell added. 

“The department will use all legal tools available to hold employers accountable when they fail to meet their FLSA obligations,” said Regional Solicitor Christine Heri in Chicago. “With this consent judgment, the defendants have been held responsible for failing to pay these workers the wages they rightfully earned during the coronavirus public health emergency.”

Attorney Sheila Naughton in the department’s Regional Office of the Solicitor in Chicago litigated the case.

Learn more about the Wage and Hour Division, including a search tool to use if you think you may be owed back wages collected by the division.

For more information about the FLSA, contact the division’s toll-free helpline at 866-4US-WAGE (487-9243). Workers and employers can call the division confidentially with questions, regardless of where they are from, and the department can speak with callers in more than 200 languages. Download the agency’s new Timesheet App, which is available in English and Spanish for Android and iOS devices, to ensure hours and pay are accurate.

U.S. Department of Labor v. Cascabel Ventures, L.L.C., d/b/a Isalita and Mani Osteria & Bar and Adam Baru

Case No: 23-cv-12366-SKD-KGA