Zahav Settles Servers’ Tip-Sharing Lawsuit for $230K

Philadelphia restaurant Zahav, the multi-award-winner owned by chef Michael Solomonov and Steve Cook, has settled a class-action lawsuit filed by a former employee: Cook and Solomonov have agreed to pay 41 servers a total of $230,000 (plus an additional $90,000 in attorney fees).

In late 2016, former server Tanya Peters filed suit against the restaurant, claiming its tip-sharing practices violated the Fair Labor Standards Act and Philadelphia’s Gratuity Protection Bill. The former was changed in 2011 to prohibit the practice of sharing tips among tipped and non-tipped employees, aka those who work the front-of-house versus those who don’t (in the coming months, that provision might change). The latter, specific to Philadelphia, explicitly defines tips and gratuities as “the sole property of the employee or employees to whom it was paid, given, or left for,” prohibiting employers from deducting or collecting those tips.

But in her suit, Peters alleged that during her 19-month employment at Zahav, servers were required “to share tips with silverware polishers,” costing her about $5 per shift. As Philly Mag reports, in their settlement, Solomonov and Cook admit no wrongdoing, and the final agreement “still has to be approved by a judge for ‘fairness.’”

In recent months, major restaurants like Danny Meyer’s Union Square Hospitality Group and Blue Hill at Stone Barns have settled class-action lawsuits stemming from tipping practices: At Blue Hill, that settlement cost the restaurant $2 million, and was paid out to roughly 250 eligible employees.

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• Zahav Agrees to Pay Servers $230,000 in Class-Action Suit [Philly Mag]
• The Supreme Court Might Get to Decide If Tip Pooling Is Legal [E]
• Labor Department Moves to Allow Restaurants to Share Tips Between Cooks and Servers [E]