Newton Restaurant Owed Back Wages to Underpaid Employees

Updated 10:26 a.m. with a statement from the Fresh City CEO.

The U.S. Labor Department has found that 34 Boston-area restaurants owe more than $1.3 million in back wages to employees, including in Newton Upper Falls and in Chestnut Hill (Brookline). 

According to a press release issued Thursday by the U.S. Labor Department, officials found violations relating minimum wage, overtime and record-keeping. The approximate $1.3 million is owed to 478 employees at various establishments around Boston. 

During the investigation, the Labor Department found that some restaurants were paying flat salaries for all hours worked and not including any overtime pay. Some restaurants were also paying incorrect overtime wages, making illegal deductions from employees' paychecks and not keeping accurate records of employees' hours.

"The restaurant industry employs some of our country's lowest paid workers, who are vulnerable to exploitation," Secretary of Labor Hilda L. Solis said in the press release. "In response to the extensive level of noncompliance we discovered, we will expand our efforts to bring the industry into compliance to ensure that employees receive the minimum wage and overtime wages required by law."

According to the press release, "all the establishments have pledged full compliance with the FLSA and have paid or are in the process of paying their employees."

"Fresh City is in full compliance with the Department of Labor and is committed to providing highly competitive wages, comprehensive benefit plans, and training for its employees," Fresh City President and CEO Ken Cox said in an emailed statement.

According to Cox, the wage issue stemmed from a third party vendor working with Fresh City that did not "fulfill their obligations to workers." Fresh City has since terminated the relationship with that third party vendor, Cox said.

In addition to paying back wages, the Labor Department also assessed more than $295,000 in liquidated damages over the last year against several restaurants. According to the Boston Globe, The Metropolitan Club was one of the establishments. 

The federal Fair Labor Standards Act requires employees at least be paid the federal minimum wage of $7.25 per hour in addition to time and a half of their regular wage for every hour worked over 40 hours. 

The Labor Department said in its press release it plans to continue to work with state agencies and the Massachusetts Restaurant Association to make sure local restaurants comply with the law.