Opinion
No. X07 CV 04 4025113 S
May 25, 2010
MEMORANDUM OF DECISION
The plaintiffs, Ellen Palmer and thirty-six other waiters or servers at the defendant, Friendly Ice Cream Corporation, filed the instant action seeking damages for violation of General Statutes § 31-60 and applicable state regulations for failure to pay minimum wage while performing non-service work, sometimes known as sidework. Pursuant to § 31-60(b)(1), restaurants are allowed to pay their servers 29.3 percent less than minimum wage if they are performing normal service and duties incidental to such service because they receive tips ("the tip credit").
The plaintiffs' request for class certification was denied. See Palmer v. Friendly Ice Cream Corp., Superior Court, complex litigation at Tolland, Docket No. X07 CV 04 4001612S (January 25, 2006, Sferrazza, J.), aff'd, Palmer v. Friendly Ice Cream Corp., 285 Conn. 462, 940 A.2d 742 (2008).
Section 31-60, in relevant part, provides: "(a) Any employer who pays or agrees to pay to an employee less than the minimum fair wage or overtime wage shall be deemed in violation of the provisions of this part.
"(b) The Labor Commissioner shall adopt such regulations, in accordance with the provisions of chapter 54, as may be appropriate to carry out the purposes of this part. Such regulations may include, but are not limited to, regulations defining and governing an executive, administrative or professional employee and outside salesperson; learners and apprentices, their number, proportion and length of service; and piece rates in relation to time rates; and shall recognize, as part of the minimum fair wage, gratuities in an amount (1) equal to twenty-nine and three-tenths per cent, and effective January 1, 2009, equal to thirty-one per cent of the minimum fair wage per hour for persons, other than bartenders, who are employed in the hotel and restaurant industry, including a hotel restaurant, who customarily and regularly receive gratuities . . ."
Section 31-62-E2(c), Regulations of Connecticut State Agencies, defines "Service Employee" to mean "any employee whose duties relate solely to the serving of food and/or beverages to patrons seated at tables or booths, and to the performance of duties incidental to such service, and who customarily receives gratuities. For the purpose of this order, a person shall not be considered to customarily receive gratuities unless a minimum of ten dollars per week in gratuities is received in the case of full-time employees, or two dollars per day in the case of part-time employees, as evidenced by signed statements of the employee, stating unequivocally that such worker did receive gratuities as herein required, which must be maintained as part of the records of the employer."
Section 31-62-E4, Regulations of Connecticut State Agencies, provides: "If an employee performs both service and non-service duties, and the time spent on each is definitely segregated and so recorded, the allowance for gratuities as permitted as part of the minimum fair wage may be applied to the hours worked in the service category. If an employee performs both service and non-service duties and the time spent on each cannot be definitely segregated and so recorded, or is not definitely segregated and so recorded: no allowances for gratuities may be applied as part of the minimum fair wage."
See footnote 2.
The parties have filed cross motions for summary judgment and this court heard oral argument on April 12, 2010. The parties strongly differ as to both the meaning of the phrase "performance of duties incidental to such service" as well as the respective burdens of proof concerning that issue. As noted by this court at the hearing, both motions must be denied because material factual issues are clearly extant. See Nolan v. Borkowski, 206 Conn. 495, 500, 538 A.2d 1031 (1988) ("[i]n ruling on a motion for summary judgment, the court's function is not to decide issues of material fact, but rather to determine whether any such issues exist").
At the hearing, the plaintiffs requested that this court expound on the burden of proof issue inasmuch as it must be resolved for trial. The plaintiffs argue the defendant has the burden of proof to establish that the plaintiffs fall within the tip credit exemption. Among other cases, the plaintiffs cite to Shell Oil Co. v. Ricciuti, 147 Conn. 277, 283, 160 A.2d 257 (1960) and Barcellona v. Tiffany English Pub, Inc., 597 F.2d 464, 467 (5th Cir. 1979) to support their argument.
The defendant argues that it is not claiming an exemption from the minimum wage law and that the plaintiffs have a standard burden of proof The defendant relies on Judge Sferrazza's earlier ruling in this case: "The plaintiffs contend that they simply need to submit proof at trial that the defendant had a corporate policy of requiring all its servers to perform the side tasks listed above, that these side tasks are non-service duties under Regulation 31-62-E4, and that the defendant failed to segregate the work hours devoted to such side duties from service duty time. Under the plaintiffs' approach, the only individualized evidence offered would be as to damages, that is the specific number of hours worked by each server against which the tip credit was taken.
"The court disagrees that such generalized proof would suffice to establish the defendant's liability with respect to each particular employee. At trial, the defendant has the right to require the plaintiffs to meet the normal burden of proof as to each member of the proposed class and prove that each particular member performed non-service duties for a specific time period. The plaintiffs acquire no presumption of violation of the minimum wage law for all servers for all hours of work because it would be convenient and expeditious to do so . . . The plaintiffs would retain the evidentiary responsibility to prove every element of the cause of action for each member of the putative class as if that member were the sole plaintiff. The plaintiffs' blanket approach to establishing liability essentially amounts to an end run around the defendant's right to have each class member prove the essential elements of liability." (Citation omitted; internal quotation marks omitted.) Palmer v. Friendly Ice Cream Corp., Superior Court, complex litigation at Tolland, Docket No. X07 CV 04 4001612S (January 25, 2006, Sferrazza, J.), citing Collins v. Anthem Health Plans, Inc., 275 Conn. 309, 320-21, 880 A.2d 106 (2005).
The court's decision was not materially different from that in Peruta v. Outback Steakhouse of Florida, Inc., 50 Conn.Sup. 51, 913 A.2d 1160 (2006). Similar to the present case, Peruta involved a dispute over the tip credit for servers at Outback Steakhouses and the court, Sheedy, J. also denied class certification. Id. Additionally, the court was "persuaded that the claimed violation of failing to segregate service and non-service duties cannot be established by generalized proof. The extensive individualized proof required to arrive at the meaning of those terms in the context of restaurant duties predominates over whatever generalized proof the plaintiffs might offer on this issue." Id., 68.
The plaintiffs suggest on page ten of their memorandum in opposition to the defendant's motion for summary judgment that "the `normal' burden of proof in these type of cases simply requires employees to show that they performed non-service duties and that they were not paid the full minimum wage for this work. Once those facts are proven . . ., the burden shifts to the employer to show that it was entitled to apply the tip credit exception to the minimum wage." They maintain that they are not required to prove minute by minute side work. Moreover, they stress that if the defendant did not segregate the time spent performing the non-service work, then it may not take the tip credit for any of the servers' work pursuant to § 31-62-E(4), Regulations of Connecticut State Agencies, which, in relevant part, provides: "If an employee performs both service and non-service duties and the time spent on each cannot be definitely segregated and so recorded, or is not definitely segregated and so recorded: no allowances for gratuities may be applied as part of the minimum fair wage." They argue that the defendant's list of twenty duties, attached to the plaintiffs' motion for summary judgment, to be performed by the servers, by itself, satisfies their burden. Yet, when asked by this court what evidence, if any, the plaintiffs produced to verify that they had actually performed these duties, plaintiffs' counsel indicated he had none other than the deposition statements of the defendant's supervisors that the work had to be performed. Hence, as noted, there are many factual issues concerning all aspects of the sidework.
In Schoonmaker v. Lawrence Brunoli, Inc., 265 Conn. 210, 828 A.2d 64 (2003), our Supreme Court adopted the burden shifting test of Anderson v. Mt. Clemens Pottery Co., 328 U.S. 680, 687-88, 66 S.Ct. 1187, 90 L.Ed. 1515 (1946), in reviewing a jury charge in an employment case where the employer had failed to keep adequate records. It quoted Anderson: "When the employer has kept proper and accurate records, the employee may easily discharge his burden by securing the production of those records. But where the employer's records are inaccurate or inadequate and the employee cannot offer convincing substitutes, a more difficult problem arises . . . In such a situation we hold that an employee has carried out his burden if he proves that he has in fact performed work for which he was improperly compensated and if he produces sufficient evidence to show the amount and extent of that work as a matter of just and reasonable inference. The burden then shifts to the employer to come forward with evidence of the precise amount of work performed or with evidence to negative the reasonableness of the inference to be drawn from the employee's evidence. If the employer fails to produce such evidence, the court may then award damages to the employee, even though the result be only approximate." (Internal quotation marks omitted.) Id., 239-40. The court added, "We do note, however, that Anderson merely imposes a shift in the burden of production, and not the burden of persuasion; the ultimate burden of persuading the trier of fact remains with the employee." Id., 241.
Schoonmaker instructs us that the plaintiffs must do more than simply introduce the list of duties; they must produce sufficient evidence to show the amount and extent of work that each plaintiff performed on that list as a matter of just and reasonable inference so that the fact finder may determine whether the work was incidental to their job and if they were improperly compensated. At that point, the burden of production switches to the defendant. For the foregoing reasons, the parties' cross motions for summary judgment are denied.