Labor Department Investigating Local Mexican Restaurant

The U.S. Department of Labor is investigating a local chain of Mexican restaurants for allegations that it required employees to work to pay off the cost of their transportation to the United States, skirted overtime wage laws and unlawfully seized tips, according to a federal lawsuit filed on Friday.

Lupita’s Authentic Mexican Food and its owners, Emilio Lopez Ramirez and Maria Guadalupe Rojas Orozco, are accused in the Labor Department’s lawsuit of retaliating against employees who complained about or threatened to quit because of poor working conditions at the restaurant’s three Centre County locations.

The investigation began in June and is ongoing.

Attempts to reach the owners for comment by phone and email were unsuccessful. Lupita’s opened its first restaurant in 2019 in Ferguson Township and subsequently established locations in Milesburg and downtown State College.

The Department of Labor Wage and Hour Division’s investigation allegedly found Lupita’s transported at least three employees from outside of the country to work in the United States, then required them to work in the restaurants to pay off the cost. According to the lawsuit, those employees were housed “in a rural location without access to public transportation,” and were reliant on the restaurants for transportation.

Lupita’s “threatened to throw certain employees out of employer-provided housing without resources when the employees made attempts to quit because of poor working conditions, including long hours without proper overtime pay,” Labor Department attorney Deirdre Aaron wrote.

When one employee asked to be paid the proper overtime wage of one-and-a-half times their regular rate for work in excess of 40 hours a week, Lupita’s allegedly began paying some overtime but withheld the rest, telling the employee it was for the cost of rent. When the same employee approached Lopez Ramirez and Rojas Orozco about the amount of debt owed for transportation to the U.S., they allegedly said it was now thousands of dollars more than the employee was previously told.

The lawsuit alleges Lupita’s is violating the Fair Labor Standards Act by retaliating against employees who complained, actions that Aaron wrote would dissuade employees from cooperating with the Labor Department investigation and asserting their right to fair pay.

The Labor Department is seeking injunctions restraining Lupita’s from violating provisions of the FLSA and from retaliating against employees who engage in protected activities. It also requests as an order to inform employees they will not be retaliated against for asserting their rights, including by speaking to Labor Department representatives, and punitive damages.