Sofitel hotels is being sued in a class and collective action for failure to pay gratuities and overtime wages that were due pursuant to the Fair Labor Standards Act (FLSA) and state law. The suit was recently filed in Pennsylvania federal court by Sheller, P.C. and Donovan Axler, LLC on behalf of current and former banquet staff employees.
U.S. Sofitel hotel locations, such as those in Chicago, Los Angeles, Miami, New York, Philadelphia, San Francisco, and Washington, D.C., charge customers a set fee in addition to the total charge for banquet events leading customers to believe that these gratuity or service fees are tips for the servers. The complaint alleges that Sofitel pays its banquet staff only a portion of these fees, rather than remitting the entirety of such charges to its banquet staff.
“By keeping a portion of gratuity fees for itself, a hotel violates the Philadelphia Gratuity Protection Bill (PGPB) and Pennsylvania’s Minimum Wage Act (PMWA),” explains attorney Marc Goldich of Sheller, P.C., who represents the plaintiff and the banquet staff putative class.
The plaintiff, Brenda Murray of Philadelphia, Pennsylvania, has dedicated over 12 years of her life to a job at Sofitel Philadelphia as a banquet house-person staff. She prepared the venue for various banquet events, trusting to be fairly compensated by her employer.
Despite requests for information regarding the hotel’s pay practices and transparency with regard to the distribution of gratuities from banquet events, plaintiff alleges that the Sofitel Philadelphia would not post for the banquet staff any details of banquet event costs or otherwise notify the banquet staff the amount of the gratuity fees paid by the customer.
When employees are paid a portion of automatic gratuities and work more than 40 hours in a week or 8 hours in a day, such payments need to be calculated for purposes of determining employees’ overtime rates.
Sofitel violated U.S. Department of Labor (DOL) and U.S. Internal Revenue Service (IRS) regulations by failing to include these gratuities as part of the hourly wage paid to Murray and the putative collective class members for purposes of calculating overtime, as alleged in the complaint. Unfortunately, as a result, Murray’s and class members’ hourly wage is lower than it should be for purposes of calculating the time-and-a-half overtime rate due them under both Fair Labor Standard Act (FLSA) and PMWA.
“We were shocked to find that Sofitel only paid its banquet staff, such as Ms. Murray, at half her regular rate for overtime as opposed to the time-and-a-half rate required by state and federal law,” Goldich says.
Many hotels, restaurants and banquet halls/caterers add an automatic gratuity to bills for large parties and banquets, whether it’s 15 percent, 18 percent, 20 percent, or more. However, under the FLSA and the IRS, these automatic gratuities are considered part of wages, and employers may be miscalculating their employees’ overtime. Moreover, many state laws are impacted when an employer withholds a portion of a gratuity or service fee.
“We want to make sure Ms. Murray and everyone who works as a banquet house-person or banquet server is protected from unlawful hotel policies and practices that cause them significant financial harm.” says Goldich.
If you are a current or former “Banquet Ambassador” or have been otherwise employed as a Banquet Staff employee at Sofitel Hotels or if you believe you may be owed unpaid wages and overtime as well as gratuity call Sheller, P.C. at 800-883-2299 to find out your rights.
Read more details about the class action suit against Sofitel.