Owners of Houlihan's in Westbury Sued For Tip Pooling, Overtime Pay Violations

A company that owns several Houlihan’s restaurants is being sued by the Department of Labor for skimming tips and wages from employees at 17 of their restaurants, including two on Long Island, the DOL announced Tuesday.

The lawsuit looks to recover millions in back wages, tips and liquidated damages on behalf of 1,430 current and former Houlihan’s employees who worked for A.C.E. Restaurant Group, which is based in Saddle Brook, NJ.

The two Long Island Houlihan’s locations are in Farmingdale, located at 923 Broad Hollow Road, and in Westbury, located at 725 Merrick Ave.

The lawsuit claims that the company:

• Had servers and bartenders put a percentage of their tips into a tip pool and used these tips to pay employees for custodial and kitchen work.
• Denied overtime pay to employees who worked at more than one restaurant, even when they clocked more than 40 hours in one workweek.
• Had employees work off-the-clock, earning tips for their labor.
• Regularly took out money from the employees’ paychecks when workers had meals during breaks while also requirement payment, at times, for the meals. This led to some workers receiving less than minimum wage, the lawsuit states.

“The defendants’ practices deprived many of their employees of money rightfully earned – money that they need to afford basics,” said Wage and Hour Division Regional Administrator Mark Watson. “Reducing labor costs by shorting workers also places law-abiding restaurants at a competitive disadvantage, and violates the principle of a fair and level playing field laid out in the FLSA.”

Other Houlihan’s restaurants under scrutiny are located in the following New Jersey towns: Bayonne, Brick, Bridgewater, Cherry Hill, Eatontown, Fairfield, Hasbrouck Heights, Holmdel, Lawrenceville, Metuchen, New Brunswick, Paramus, Ramsey, Secaucus and Weehawken.

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