Law360 (March 24, 2023, 8:34 PM EDT) — A restaurant in Downtown Las Vegas has been slapped with a proposed collective and class action claiming it violated the Fair Labor Standards Act and Nevada law by instituting a tip pool that required servers and bartenders, tipped employees, to share a portion of their tips with management.

The popular eatery owned by Gibraltar Hospitality Services LLC, which does business as 7th & Carson, allegedly engaged in unlawful tip pooling, tip-sharing arrangements and management misappropriation of tips taken from its tipped employees because it forced them to share a percentage of their tips with managers, according to the suit removed to Nevada federal court on Thursday.

“The action of defendant in wrongfully obtaining and depriving tipped employees of earned tips has the same net effect as a deduction of the tipped employees’ wages, and amounts to unlawful conversion of tipped employees’ money and property in violation of law,” the suit alleges.

Lead plaintiff Douglas Vasquez, a former server and bartender, initiated the suit on Jan. 26 in state court before the restaurant removed it to federal court.

The Nevada resident claims that he was fired from his job in retaliation for opposing the restaurant’s unlawful tip-confiscation policy.

“Defendant terminated plaintiff for reasons which violate public policy including, but not limited to, Nevada’s public policy against terminating an employee for opposing an unlawful tip-confiscation policy and Nevada’s public policy against terminating an employee for engaging in protected activities,” the suit says.

Vasquez also claims that he and hundreds of other tipped servers and bartenders in the proposed class are entitled to a compensatory refund of all tips that were wrongfully taken from them, as well as attorney fees and liquidated damages.

The class is composed of an estimated 500 servers, bartenders and other tipped workers whose tips during the past three years were “subject to mandatory pooling and confiscation by the management, executives, and/or supervisors of defendant,” according to the suit.

A lawyer for Vasquez, Kaine M. Messer of Gabroy Messer Attorneys at Law, told Law360 on Friday that the restaurant owners haven’t yet given counsel their books to confirm the number of servers in the proposed collective and class, but the law firm’s research so far shows on a good-faith basis that it was hundreds of workers.

Another Gabroy Messer lawyer representing Vasquez, Christian Gabroy, asserted that for many individuals in a service-based industry town like Las Vegas, tip pool theft is all too common.

“Employers unfortunately utilize tip pools as a cookie jar to pull from,” Gabroy said. “You have a server, a bartender, a busser, a dishwasher take the money that he earned by providing good service to the customers and give that to the manager, then the employer company doesn’t have to spend as much on the management at the hands of the individual server.”

Representatives for the restaurant did not immediately respond Friday to a request for comment.

Vasquez and the proposed class are represented by Christian Gabroy and Kaine M. Messer of Gabroy Messer Attorneys at Law.

Gibraltar Hospitality Services d/b/a 7th and Carson is represented by David B. Dornak and Allison L. Kheel of Fisher Phillips.

The case is Vasquez v. Gibraltar Hospitality Services LLC, case number 2:23-cv-00441, in the U.S. District Court for the District of Nevada.

–Editing by John Campbell.

Read the full article here: https://www.law360.com/articles/1589631/downtown-las-vegas-restaurant-hit-with-tip-pooling-suit

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