Fusion Steakhouse to pay $1.45 million for labor rights violations

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Restaurant owners failed to pay overtime and keep records of hours worked.

The owners of Fusion Japanese Steakhouse were ordered to pay $1.45 million in back wages and damages after failing to properly pay 116 current and former workers, according to a recent federal court ruling.

The violations, committed by owners Yuan Zheng Xiao and Christine Xiao, occurred between October 18, 2014 and October 7, 2017 at three restaurants: Washington, Pennsylvania; and Vienna and Triadelphia, West Virginia. The complaint was filed in March 2019.

State restaurant court documents failed to compensate workers — cooks, sushi and hibachi chefs, dishwashers, busses and servers — who worked more than 40 hours a week at one-and-a-half times their normal rate. In fact, many employees worked an average of 50 to 60 hours per week. The owners also failed to keep records of the number of hours worked by their kitchen workers, or their full names, addresses, occupations, gender, regular pay rates, regular wage rates and other key metrics.

“The defendants knew or acted with reckless disregard as to whether their practices for paying kitchen workers at the Fusion restaurants violated the overtime provisions of the law,” the court documents say.

In addition to the $1.45 million, Yuan Zheng Xiao and Christine Xiao must pay $76,124 in civil fines for intentionally ignoring the Fair Labor Standards Act (FSLA). Restaurant owners will have to cover the entire penalty, plus 1% interest, unless everything is paid within 30 days.

It’s not the first offense either. Following investigations in 2010, 2011, and 2013, Yuang Zheng Xiao was ordered to return his salary after violating FLSA provisions on minimum wage, overtime, and record keeping.

“This legal action recovers workers’ hard-earned wages and sends a strong message to other catering employers that violations have a high cost,” labor attorney Seema Nanda said in a statement. “The U.S. Department of Labor is prepared to use all available tools, including litigation, to prevent employers from depriving workers of their wages.”

Jessia Looman, acting administrator of the wage and hour division, said maintaining and recruitment workers is more difficult in today’s job market, and it will be even more difficult if employers violate the legal rights of their employees. According to Looman, the Bureau of Labor Statistics projects that 958,000 food and accommodation service workers left their jobs in December 2021 and forecasts 41,400 job openings for food service managers each year from 2020 to 2030.

“Wage theft is illegal, harms workers and their families, and undermines responsible, law-abiding employers,” Looman said in a statement. “This important judgment on behalf of restaurant workers demonstrates the Department of Labor’s commitment to protecting these essential workers.”

The consent judgment follows an investigation by the division’s Pittsburgh District Office and litigation by the Philadelphia Regional Attorney’s Office. The judgment was rendered by the United States Court for the Western District of Pennsylvania.

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