Compere v. Nusret Miami, LLC, No. 20-12422 (11th Cir. 2022)
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Plaintiffs, a group of tipped employees at Nusret, filed suit under the Fair Labor Standards Act (FLSA), challenging Nusret's compensation scheme. Plaintiffs alleged that from November 1, 2017, through January 18, 2019, the restaurant paid them less than the required federal minimum and overtime wages and forced them to participate in an illegal tip pool with non-tipped employees.
The Eleventh Circuit concluded that Nusret's mandatory 18% "service charge" is not a tip under the FLSA and associated regulations and could lawfully be used to offset Nusret's wage obligations under the FLSA. The court agreed with the district court that the mandatory service charge was a bona fide service charge and not a tip because it was a compulsory charge for service, and the decision to pay it—and the amount to pay—were not determined solely by the customer. The court declined to reach the merits of plaintiffs' remaining arguments and affirmed the district court's award of summary judgment in favor of Nusret.
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