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$5M in back pay and damages to be paid to Houlihan's employees

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The owner of Saddle Brook-based A.C.E. Restaurant Group Inc. and A.C.E. Restaurant Group of New York LLC, also known as Houlihan’s, agreed to pay $5 million in back wages and damages to 1,471 current and former employees to resolve a U.S. Department of Labor lawsuit alleging they were denied overtime pay.

The agreement is pending review and approval by the U.S. District Court for the District of New Jersey.

The Department’s Wage and Hour Division found 17 restaurants and their owner Arnold Runestad in violation of the Fair Labor Standards Act with the denial of overtime pay to employees clocking over 40 hours per week. They also violated minimum wage requirements by including ineligible, non-tipped employees in a mandatory tip pool, retaining portions of tips and regularly withholding money from employees’ paychecks for meals they had already paid for out of pocket.

“The Wage and Hour Division works to ensure that employees receive the wages they have rightfully earned, and that employers who fail to comply with the law do not gain an unfair competitive advantage over those who do,” said Wage and Hour Regional Administrator Mark Watson Jr. in a statement.

The agreement also requires the restaurants and their owner to comply with the FLSA’s minimum wage, overtime, record-keeping and anti-retaliation provisions, and provide employees with a notice of their FLSA rights.

Fifteen New Jersey restaurants were cited; they are located in Bayonne, Brick, Bridgewater, Cherry Hill, Eatontown, Fairfield, Hasbrouck Heights, Holmdel, Lawrenceville, Metuchen/Woodbridge, New Brunswick, Paramus, Ramsey, Secaucus, and Weehawken. Two New York locations also cited are in Farmingdale and Westbury.

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Gabrielle Saulsbery

Gabrielle Saulsbery

Albany, N.Y. native Gabrielle Saulsbery is a staff writer for NJBIZ and the newest thing in New Jersey. You can contact her at gsaulsbery@njbiz.com.

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