A wage and tip theft lawsuit was brought by servers across Kentucky, Ohio, and Indiana against Tony’s Steaks and Seafood, a restaurant known for its upscale dining locations in Lexington, Indianapolis, and Cincinnati. The company was accused of requiring tipped employees to participate in an unlawful tip pool that included salaried managers.
According to court documents, servers alleged that this practice violated both federal and state labor laws, including the Fair Labor Standards Act and the Kentucky Wage and Hours Act. The lawsuits claimed that Tony’s improperly claimed a tip credit while redistributing tips to salaried staff, which disqualified the restaurant from paying sub-minimum wages. Employees also stated that the tip-pooling arrangement was not voluntary but a condition of their employment.
Originally filed as three separate lawsuits, the cases were later consolidated into a single federal action. In May 2023, the parties reached a $1.5 million settlement to resolve the claims. The agreement included payments to 173 servers across all three states, with Kentucky servers receiving over $546,000. Individual amounts varied, with some participants receiving over $35,000. A fairness hearing is scheduled to finalize the settlement.
This case follows earlier legal action involving similar claims by other former employees. Although the restaurant previously denied all allegations, another class action with related accusations was filed in August 2023.
Lessons Learned from the Case:
- Illegal tip sharing can lead to wage violations. Requiring tipped staff to share earnings with salaried employees violates federal and state laws.
- Mandatory tip pools must follow the law. Tip pooling as a condition of employment is not automatically lawful and can trigger liability.
- Class actions can span multiple jurisdictions. Similar violations in multiple states may be consolidated, increasing exposure for employers.
If you want to know more about salaried employee rights, read our guide on What are my rights as a salaried employee in Kentucky?
