The parent company of American casual dining restaurant Olive Garden is being sued over its employee tipping policy.
Nonprofit organization One Fair Wage filed a lawsuit against Darden Restaurants over the practice it claims encourages racial discrimination and sexual harassment.
The lawsuit - filed Friday in a California federal court - alleges Darden Restaurant's tipping policy causes some of its employees of color to earn less. According to a poll conducted by the group, around 18% of the company's nonwhite employees earn less in tips per hour.
Like other restaurants in 43 other states, Darden Restaurants pays its employees wages that are significantly lower than the minimum. This is possible through the "tipped minimum wage" rule, which allows restaurants to pay less if the tips add up to the locality's required minimum wage. One Fair Wage is one of the many advocacy groups fighting to reform the regulation.
According to One Fair Wage, Darden Restaurants pay its Olive Garden employees as little as $2.13 per hour as long as the tips add up to the minimum wage.
The lawsuit alleges managers at Darden's outlets can control or influence employee's wages by assigning specific servers to shifts or seating sections. Managers allegedly asked some servers to dress more suggestively or "sexier" to earn higher tips, the group said. Some managers have also turned a blind eye to sexual harassment to keep customers happy, the lawsuit said.
One Fair Wage made suggestions to remedy the issue. The group said the company could standardize service charges or add them directly to bills to exclude race from tipping decisions.
"The cash wage policy is the direct cause, or at least a motivating cause, of this disparate impact," the group said in its complaint.
One Fair wage is asking the court to consider Darden's tipping policies a violation of the Civil Rights Act. If granted, the group is seeking an injunction against Darden to force it to stop its current tipping policies. The lawsuit, in which One Fair Wage is named as the only complainant, is the latest action taken by workers' groups to change or eliminate unfair tipping policies.
