An East Coast Mexican restaurant chain’s multi-million-dollar settlement with the U.S. Department of Labor includes nearly $600,000 in back wages for workers at its State College location.
Plaza Azteca, which includes Plaza Mexican Bar & Grill at 1550 S. Atherton St., must pay $11.4 million in back wages and damages to 1,320 employees at 40 locations in seven states as part of a consent judgment this week in the U.S. District Court for the Eastern District of Virginia. The settlement includes $596,000 for 41 workers at the State College restaurant.
According to the labor department, Plaza restaurants paid back-of-the-house employees predetermined amounts. That resulted in some who worked up to 40 hours a week not being paid the required minimum wage and those who worked over 40 hours not being paid overtime wages.
The restaurants, also did not maintain accurate records of employees’ work hours and wages.
“Our investigators found Plaza Azteca knew of its legal obligations to pay workers minimum wage and overtime and keep accurate payroll records and yet, willfully disregarded federal law,” DOL Wage and Hour Administrator Jessica Looman said in a news release. “The employers failed to pay full wages to more than 1,000 employees. The court’s action in this case is an important step in our efforts to make a meaningful difference in the lives of these workers by recovering their hard-earned wages.”
After a series of investigations, the labor department filed the complaint in September 2021 for violations of the Fair Labor Standards Act between 2016, the year Plaza Mexican Bar & Grill, and 2021.
The restaurants, which also must pay $620,000 in civil penalties, have been in compliance since 2022 with the FLSA since January 2022, according to the consent judgment.
Plaza disputes that it violated the law, but agreed to a resolution “to bring closure to this matter.” The case had been scheduled for a jury trial.
Former or current affected employees can contact the DOL’s Wage and Hour Division at 215-861-5180 with questions.
