One Fair Wage Inc., which advocates for ending the subminimum wage, is suing Olive Garden parent Darden Restaurants Inc., alleging the company’s tipping policy leads to sexual harassment and racial discrimination.
One Fair Wage filed the lawsuit Thursday against the Orlando, Fla.-based company, which has 1,822 casual-dining restaurants that include LongHorn Steakhouse and Cheddar’s Scratch Kitchen, in federal court for the California Northern District.
“To be clear, this is not about Darden,” the company said in a statement. “The complaint makes clear that their objections are with federal and state wage laws – not with our practices.”
One Fair Wage has been advocating against the tipped minimum wage, which in 43 states is as low as $2.13 an hour. Restaurants can pay that rate if hourly wages and tips meet or pass the localities’ pay thresholds or the federal minimum wage of $7.25 an hour.
A congressional effort earlier this year to raise the federal minimum wage through reconciliation as part of the COVID-19 stimulus bill was stalled on parliamentary rulings.
The One Fair Wage lawsuit alleges “the subminimum wage is the direct cause of, or at least a motivating factor in, a documented increase in sexual harassment” and violates prohibitions on workplace discrimination in Title VII of the Civil Rights Act of 1964.
“One Fair Wage, as an organization, has been injured by Darden’s policies,” the lawsuit claims. “Because Darden maintains the policies complained of here, One Fair Wage has been forced to divert its resources to address Darden employees’ complaints that they have suffered more and worse sexual harassment than their coworkers of the same sex who are not subject to the policies, as well as complaints from Darden employees of color that they have received less in tips than their white co-workers.”
Darden said it has “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.”
The company in late March said it was raising the pay floor for its hourly employees to $10, inclusive of tip income, and committed to increasing that to $11 an hour in January 2022 and $12 an hour in January 2023.
“We are proud to be the employer of choice in the full-service dining industry, where our tipped team members earn more than $20 per hour on average,” a Darden spokesman said.
One Fair Wage’s suit offered alternatives such as pooling tips or adding a service charge to checks.
“The tipping policy encourages customers to directly compensate employees based on factors whose consideration is illegal and irrelevant (e.g., race), and nothing about positions like servers and bartenders suggests that they must be subjected to the policy whereas other positions are not,” the lawsuit claims. “Thus, Darden’s tipping policy actively untethers pay from legitimate job performance metrics.”
One Fair Wage asked the court to declare Darden’s existing tipping policies as unlawful and seeks an injunction against the company’s practices as well as fees.
Darden also owns Yard House, The Capital Grille, Seasons 52, Bahama Breeze and Eddie V's.
Contact Ron Ruggless at Ronald.Ruggless@Informa.com
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