Lawsuit Targets Massive Restaurant Group’s Practice of Paying Servers Less Than Minimum Wage

One Fair Wage is suing Darden, the parent group of restaurant chains like Olive Garden, Capital Grille and Longhorn Steakhouse for wage policies that it says causes sexual harassment and pay disparity among servers.

(By Anthony92931 – Own work, CC BY-SA 3.0)

OAKLAND, Calif. (CN) — The advocacy group One Fair Wage is taking on the largest restaurant chain in America with a federal lawsuit challenging its policy of paying tipped workers less than minimum wage, claiming it leads directly to higher rates of sexual harassment and pay inequity for servers of color.

Its lawsuit filed Thursday claims Darden Restaurant Group, which operates national chains like the Olive Garden and Longhorn Steakhouse, maintains a wage policy that forces workers to rely on tips to make up the bulk of their wages.

This in turn puts servers at the mercy of potentially biased, racist or sexist customers.

“You have to literally be OK with being harassed if you want to pay your rent,” said Ptorsha Cozart, who makes $2.33 an hour working as a server at Darden-owned Cheddar Scratch Kitchen in Kenosha, Wisconsin.

Cozart said that during the pandemic, customers began asking her to pull down her mask so they could rate her attractiveness, and ultimately, her tip-worthiness.

“Oh you’re pretty, here, now I’m going to tip you,” she said they told her.

Cozart, who is Black, said that customers would sometimes ask for a white server.

“The racism and discrimination is so vast in my restaurant and across the board,” she said.

Bartender Carisa Shade, who works at an Olive Garden in North Carolina, said it’s very hard to go into work with the pressure of knowing that she’ll have to do whatever customers demand of her just to earn enough in tips to support her four children.

“I know I have to go into work and face all obstacles with a smile on my face no matter what is being said to me, told to me, done to me, asked of me. Because I have to feed and go home to four children,” she said.

“At the end of the day I go and I count my cash. Counting the money I’ve collected through the day, I think back to what may have happened that day. Maybe someone was rude to me or sexually harassed me for hours while I served them. But I had to swallow it because I know I have children I have to face and raise, and they are more important to me than my pride. That’s not a good feeling — to count $55 at the end of a shift.”

One Fair Wage’s lawsuit says the standard “sub-minimum” wage of $2.13 an hour violates Title VII of the federal Civil Rights Act, which bars employment discrimination based on race, color, religion, sex and national origin.

It’s a novel theory, bringing a civil rights discrimination case against a national restaurant chain based on its tipping and wage policies. But for One Fair Wage and the servers it represents, it’s about time.

One Fair Wage’s Executive Director Saru Jayaraman said that as the most powerful restaurant group in the National Restaurant Association, Darden has poured millions into lobbying Congress to keep wages “as low as possible.”

But seven states — California, Oregon, Washington, Nevada, Minnesota, Montana and Alaska, do things differently. Restaurants in those states, including those owned by Darden, are required to pay workers a full minimum wage plus tips. Jayaraman said this has not harmed Darden’s bottom line in the least, even in California where the minimum wage is $15.

“It has the most restaurants in California of any state. Darden itself has proved that it is able to pay a full minimum wage, and it thrives when it pays a full minimum wage,” she said.

“We can do better,” said Adam Orman, who owns the 120-seat Italian restaurant L’Oca d’Oro in Austin, Texas. “I’ve seen too many women treated callously by managers, coworkers and customers who know that female servers’ livelihoods, all servers’ livelihoods are dependent on tips at all costs.”

Orman belongs to a consortium of 200 restaurants committed to paying workers a living wage. He pays servers a baseline of $15-$18 an hour and charges customers a hospitality fee. Guests can still tip.

“And they do,” he said. “And our entire staff pools those tips.”

Orman, who has worked in the restaurant industry for 20 years, also said white male servers are generally tipped more than servers of color. “There are too many places for racism and misogyny to leak into our system where compensation is based on discretionary tips.”

Jason Harrow, an attorney with the Los Angeles firm Gerstein Harrow LLP who represents the group, said in an interview Thursday that the lawsuit does not aim to end tipping completely, but to move toward a system where servers are not so heavily reliant on tips.

“We think of it as restaurant policy 2.0,” he said. “The idea is to make tips a benefit and not make it literally so that servers and bartenders need to do whatever it takes to not go hungry.”

The lawsuit targets Darden because it is such a huge chain, and has outsized influence on the rest of the industry. Harrow said Darden has shown that it can operate “very profitably” in states that require a full minimum wage.

“Policies trickle down,” he said. “If we get everyone up to a better and higher, more sustainable standard, you don’t have these competitive pressures.”

One Fair Wage seeks an injunction barring Darden from continuing to pay servers sub-minimum wages.

“It’s trying to change the industry and change the practice of one of the biggest companies. It’s not doing this to get rich — it’s doing this to make restaurant workers’ lives fairer,” Harrow said. “There are so many better solutions. From service charges, to tip pooling, to recommended gratuities, to providing customers with guidance.”

One Fair Wage is also represented by Chris Willams, Sheila Maddali and Ryan Nelson with the National Legal Advocacy Network in Chicago.

In an email, Darden Restaurant Group spokesman Rich Jeffers said the lawsuit is not about Darden’s practices, but about state and federal wage laws.

“We have zero tolerance for any form of harassment or discrimination in our restaurants, and we have strong policies in place to ensure our team members are treated with respect and feel safe and valued at work,” he added.

He said tipped workers earn more than $20 per hour on average.

“We also recently announced that every hourly restaurant team member, regardless of role, now earns at least $10 per hour, including tip income, and we committed to raising the amount to $11 per hour in January 2022 and $12 per hour in January 2023,” he said.

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