Kansas City Lawyers Representing Whistleblowers and Employees Nationwide

ABC Debacle: Labor Law And Amy’s Baking Company

An especially popular episode of the Fox show “Kitchen Nightmares” aired back in May and horrified viewers across the country. The problem was not cleanliness, no; the restaurant was actually sparkling clean. The trouble that stunned viewers was the wildly inappropriate, irrational and potentially illegal behavior of the restaurant’s owners, Amy and Samy Bouzaglo.

The appearance of Amy’s Baking Company (ABC) on the show set off a firestorm of media coverage about the wild behavior of the restaurant’s owners. Employees were verbally abused, customers physically assaulted and host of the show, Gordon Ramsay, ended up storming out in disgust. These actions were only made worse by their post-show behavior when Amy Bouzaglo took to Twitter and Facebook, hurling epithets at her detractors and threatening to kill those who continued criticizing her company. All in all, a nightmare.

Just when you thought things couldn’t get worse, they did. One of the problems mentioned in the television show was that Amy and Samy routinely confiscate tips from their waiters and waitresses. The owners justified this behavior by saying their employees were lazy and ungrateful and did not deserve the extra money. After a harsh reprimand by the show’s host and horrified reactions by customers, the two claimed that they paid their employees minimum wage and thus were not legally required to give them tips. Wrong again, at least according to some labor law experts.

After the stir created by the show, online petitions sprouted up asking the Department of Labor to investigate claims regarding stolen tips. A spokesperson for the DOL says that the Bouzaglo’s justification about paying minimum wage does not hold up. Even if they really do pay employees minimum wage and thus do not take advantage of the tip credit, the DOL says its regulations are clear that under the Fair Labor Standards Act, tips are considered the property of the employee. Specifically, the DOL spokesperson says that employers are prohibited from using an employee’s tips for any reason other than in furtherance of a valid tip pool.

Though it’s hard to imagine how, things may have gotten even worse for the couple after a recently created employee contract was leaked to the press. The agreement contains several relatively reasonable clauses, including requirements that employees be appropriately dressed and not use cellphones during work hours. After this, the contract goes off the rails.

The contract, which Amy and Samy require all new employees to sign, says that employees are obligated to work holidays and weekends, no exception. Anyone who fails to show up faces a $250 penalty. The Bouzaglo’s also require the new employees to sign an agreement stating that all “tips” are property of the restaurant and that they agree to waive all claims to such money. Finally, and most bizarrely, the two have inserted a provision which says that because of the hard work exerted in training employees, anyone who is either fired or quits Amy’s Baking Company will not be allowed to work for any competitor within a 50 mile radius for one year.

Labor law attorneys say many, if not most, of the provisions of the new “contract” are unenforceable and represent clear breaches of widely understood employment law. Where Amy’s Baking Company goes from here is uncertain, but chances are it will be to court.

Source: “Amy's Baking Company could face legal 'nightmare',” by Erik Sherman, published at CBSNews.com.

Source: “Amy’s Baking Company Employee Contract Is Exactly What You'd Expect From The Company,” by Charles Poladian, published at IBTimes.com.

See Our Related Blog Posts:
"Tip Pooling" Leads To Lawsuit Against Famous Steak House
Famous Chef, Mario Batali, Settles Tip Case for $5.25M

For More Information

  • Please do not include any confidential or sensitive information in this form. This form sends information by non-encrypted e-mail which is not secure.

    We hope to hear from you. However, please note that you are not represented by our firm or any of our lawyers as a client until you receive a written engagement letter from us.

  • This field is for validation purposes and should be left unchanged.