Our Press Release of this date, celebrating the settlement of our most significant case:
More than 20,000 current and former food servers, bussers, hosts and hostesses, bartenders and kitchen workers at California Red Lobster and Olive Garden restaurants will share $9.5 million as part of a settlement involving claims that they were prevented from taking breaks, and that they were required to purchase and maintain their own employee uniforms. Red Lobster workers from more than 40 locations in California who worked there from February 21, 1998 to the present will share $5.5 million, while Olive Garden employees who worked from March 24, 1999 to the present will share another $4 million.
Two food servers at the Brea Red Lobster restaurant filed the first class action complaint in February 2002, alleging that Red Lobster refused to allow breaks to its non-exempt workers throughout the State of California. The complaint was subsequently amended to include damages and restitution for Red Lobster’s former policy of charging workers for uniforms, and for making the employees maintain their own uniforms. In March 2003, an Olive Garden employee filed a similar complaint, seeking certification of all GMRI workers, including both the Red Lobster and Olive Garden chains. Then, in May 2004, while the first case was on appeal from an Orange County Superior Court ruling denying the defendant’s motions for summary judgment and to compel arbitration, a third lawsuit was filed in Sacramento, California.
Under California Labor Code § 226.7 and Industrial Welfare Commission Wage Order 5, employees are entitled to a paid ten-minute break for every four hours of work, or major fraction thereof. Employees working at least 3½ hours are entitled to one paid break, and earn a second paid break after six hours. Furthermore, employees who work more than five hour shifts are entitled to a 30 minute break which need not be paid. Under California Labor Code § 450 and Industrial Welfare Commission Wage Order 5, employers are required to pay for the cost of purchasing and maintaining employee uniforms and may not require employees to purchase anything of value, including uniforms, from the company.
This is one of the largest rest period class actions ever certified in California. This case was hard fought for three years, in two counties, the Court of Appeal and the California Supreme Court. The Red Lobster case was settled more than two years after the first mediation session. A second mediation session was scheduled after the California Supreme Court denied review of a 4th District Court of Appeal ruling preventing Red Lobster from compelling the employees to arbitrate the Red Lobster class claims. Several weeks after the second mediation, before respected mediator Mark S. Rudy of San Francisco, the parties reached a tentative settlement agreement. The Olive Garden case settled shortly thereafter, and an integrated and final settlement of the three lawsuits was signed on June 25, 2005.
The settlement requires the company to mail claim forms to all eligible employees. Workers must submit these forms in order to be eligible to receive their payments under the settlement. Employees can visit www.lobsterlawsuit.com for an update on the status of these legal actions.
GRMI, Inc., a subsidiary of Darden Restaurants, Inc. (stock symbol DRI), which operates the Red Lobster and Olive Garden restaurant chains in California, did not admit liability in the settlement. The settlement does not dictate any change in the restaurant chain’s practices. However, attorneys for the class do not foresee any ongoing problems with GMRI’s policies. Since 2002, the reports of employees missing their meal and rest breaks have been few, and we have seen instances in which restaurant managers who did not permit employees to take breaks have been subject to discipline by the company. Employees are no longer required to purchase uniforms.
Class Representatives: For Red Lobster: Michelle Whalen-Camacho, Miguel Perez, Jason Nash and Torrey Hughes. For Olive Garden: Kelly Mancuso and Jessica Springer. · Defendant: GMRI, Inc., a subsidiary of Darden Restaurants, Inc. (DRI), a publicly traded corporation headquartered in Orlando, Florida.
Courts: The initial lawsuit was filed by Perez and Whalen-Camacho on February 21, 2002 in the Superior Court of the State of California, for the County of Orange, Case No. 02CC00038. The Mancuso action was filed March 24, 2003 in the Superior Court of the State of California, for the County of Orange, Case No. 03CC00098. The Nash case was filed on May 11, 2004, in the Superior Court of the State of California, for the County of Sacramento, Case No. 04AS01949. Whalen-Camacho, Perez, Mancuso and Springer intervened in the Nash case in April 2005. That case is currently assigned to the Honorable Loren E. McMaster.
Claims alleged: Violations of California Labor Code § 226.7 and Industrial Welfare Commission Wage Order No. 5, for failure to provide 30 minute meal periods and 10 minute rest periods; violations of California Labor Code § 450 and Industrial Welfare Commission Wage Order No. 5, for compelling employees to purchase and maintain uniforms. The class also alleges that the meal and rest break violations, uniform violations and equipment sales constitute violations of California Business & Professions Code § 17200 et seq. California’s Unfair Competition Law.
Primary factual allegations: Until 2002, GMRI, Inc.’s Red Lobster and Olive Garden chains prevented employees from taking breaks at their restaurants throughout California, and failed to pay employees an extra hour of pay when such breaks could not be taken. From 2002 to the present, although the restaurants had systems in place to provide for breaks in most instances, on the occasions when breaks were missed, employees were still not paid the extra hour of pay. In addition, for a portion of the relevant time period, Red Lobster required employees to purchase, launder and press their employee uniforms at the employee’s sole expense. The court did not rule upon the merits of these allegations, which GMRI has continued to dispute.
Relief sought: Payment of up to one hour of pay per day for each meal period violation, and one hour of pay per day for each rest period violation, for employees who worked during the relevant time periods of February 1998 to June 2005; restitution for all hourly California employees who were denied paid rest breaks, or who were required to purchase uniforms or equipment, from February 1998 to June 2005.
Plaintiffs' attorneys: The employees were represented by Walsh & Walsh, P.C. (Michael J. Walsh and Mark A. Walsh) of Irvine, California, Langford & Langford, APLC (Michael S. Langford and Karin A. Langford) of Santa Ana, California, Kingsley & Kingsley (Eric B. Kingsley) of Encino, California, the Law Offices of Michael L. Carver (Michael L. Carver), of Chico, California, and the Law Offices of Robert S. Skripko, Jr. (Robert S. Skripko, Jr.) of Santa Ana, California.
Defendant’s attorneys: The employer was formerly represented by Littler Mendelson LLP, but at the time of the settlement, was represented by Jackson Lewis LLP (Mia Farber, David S. Bradshaw and Cary Palmer), Sacramento, California.
Source/Contact: Walsh & Walsh, P.C. Michael J. Walsh, Esq. 420 Exchange, Suite 270 Irvine, CA 92602 Tel: (714) 544-6609 Fax: (714) 544-6621 E-mail: [email protected] Website: http://www.lobsterlawsuit.com