Waiter Can Sue Over Firing Tied to Illegal Tip-Share Rule

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By Jon Steingart

June 27 — A former waiter who was fired when he refused to participate in a tip-sharing arrangement he believed was illegal may proceed with his wrongful discharge lawsuit, a Minnesota appeals court ruled ( Burt v. Rackner, Inc. , 2016 BL 204606, Minn. Ct. App., No. A15-2045, 6/27/16 ).

The decision is a reminder that breaking tip-pool rules can expose an employer to lawsuits based on more than just wage-and-hour violations.

A lower court held that the Minnesota Fair Labor Standards Act doesn't allow a lawsuit by someone who says he was fired for refusing to comply with an unlawful requirement. The June 27 Minnesota Court of Appeals decision revives Todd Burt's claim against Bunny’s Bar & Grill.

Law Prohibits Mandatory Tip Pools, Waiter Says

Burt said he was fired because he wouldn't share his tips with those who bus tables. The requirement to share violates an MFLSA provision against requiring employees “to contribute any or all of the gratuity to a fund or pool operated for the benefit of the employer or employees,” he said.

The MFLSA allows aggrieved workers to sue when their employer breaks the law. This right of action “broadly applies to any violation,” Judge John R. Rodenberg wrote for the court.

Allowing Burt to proceed against his former employer avoids a situation in which an employee who complies with a prohibited requirement may recover but someone who is fired for his refusal to go along with it “is just out of luck,” Rodenberg said.

“That position is inconsistent” with “any common-sense understanding of the legislature’s intention in broadly providing employees a civil remedy for MFLSA violations,” Rodenberg said.

Bassford Remele PA represented Burt. Arthur, Chapman, Kettering, Smetak & Pikala PA represented Bunny's.

To contact the reporter on this story: Jon Steingart in Washington at jsteingart@bna.com

To contact the editor responsible for this story: Susan J. McGolrick at smcgolrick@bna.com

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