Boludo Holding Co. fired worker who cooperated with federal investigators
MINNEAPOLIS – Four Minneapolis restaurants with shared ownership will pay $105,784 in back wages, damages and penalties to resolve violations identified by U.S. Department of Labor, including illegally firing an employee who cooperated with investigators.
The department’s Wage and Hour Division found Boludo Holding Co. and its owners, Jerad Rassmussen and Facundo Defraia, violated the Fair Labor Standards Act’s overtime provisions in several ways and deprived 51 employees of $44,915 in earned overtime wages at Boludo El 38, Boludo Downtown, Boludo Uptown and Boludo Como, and terminated one worker at its Uptown restaurant after they spoke with investigators.
“Retaliating against workers who engage in protected activities, such as cooperating with a federal investigation, is a blatant violation of the law that we will not tolerate,” said Wage and Hour Division District Director Kristin Tout in Minneapolis. “The Department of Labor remains firmly committed to protecting workers against retaliation and ensuring they are paid fully for their hours worked.”
In addition to owing $44,915 in back wages, the restaurants’ operators are also liable for an equal amount in liquidated damages, bringing the total recovery for the affected workers to $89,830. The division also assessed the restaurant group with $15,954 in civil money penalties for child labor and tip retention violations.
The investigation was part of an initiative by the division to examine common food service industry violations by Midwest employers.
Specifically, division investigators found that the employers violated the Fair Labor Standards Act by doing the following:
- Including managers and shift supervisors in a tip pool for servers and others allowed to receive tips, which invalidated the tip pool.
- Not combining hours employees worked at more than one location, which denied employees overtime wages when they worked more than 40 hours in a workweek.
- Allowing at least four workers to routinely use other names and identification numbers to clock-in to avoid paying overtime.
- Paying two employees straight-time rates for overtime hours, instead of time and one-half their regular rate of pay as required.
- Not maintaining accurate employment records with employee start and stop dates and contact information and allowing individual workers to use others’ names to clock-in.
- Failing to distribute tips to workers or provide records showing that tips were paid to workers properly.
- Allowed one 15-year-old to work outside permitted hours.
“Too often, our investigations in the food service industry find employers violating federal overtime, minimum wage and recordkeeping regulations, while workers remain unaware of their rights or afraid to question whether their paychecks are accurate,” Tout continued. “This kind of exploitation hurts workers and their families’ ability to earn a living and harms law-abiding restaurant operators by giving violators an unfair and illegal competitive advantage.”
In addition to paying back wages, damages and penalties, Boludo agreed to create a worksheet to process payroll that will have a weekly run to verify hours over 40 in a week and will pay overtime after 40 hours per week and abide by the FLSA in the future.
In fiscal year 2024, the Wage and Hour Division recovered more than $35 million in back wages for more than 27,500 food service industry workers nationwide. In the past five years, the Wage and Hour Division in Minnesota found $2,459,002 in back wages due to 865 food service workers.
The division’s restaurant compliance toolkit explains wage laws for employers and workers.
Learn more about the Wage and Hour Division, a search tool to use if you think you may be owed back wages collected by the division and how to file an online complaint. For confidential compliance assistance, employees and employers can call the agency’s toll-free helpline at 866-4US-WAGE (487-9243), regardless of where they are from.
Download the agency’s Timesheet App for iOS and Android devices – available in English and Spanish – to ensure hours and pay are accurate.
