Servers Accuse Florida Restaurant Southeast Eatery of Fraudulent Payroll Practices

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A proposed collective action citing several potential violations of the Fair Labor Standards Act (FLSA) has been filed against Alex of Polk County, Inc. and three individuals with control of the business.

The defendants—who operate a Polk County, Florida restaurant known as Southeast Eatery—are accused of depriving their servers of the required minimum wage and furnishing fraudulent payroll records to cover up these alleged violations.

“With respect to cash tips,” the complaint reads, “Defendants would require Plaintiffs to artificially increase the amount of cash tips reported in order to give the appearance that Plaintiffs were making at least the required minimum wages, regardless of whether they actually received at least minimum wage.”

In addition, the complaint claims the defendants also altered the amount of credit card tips and reported “a higher amount to the payroll service than was captured by the POS [point of sale] system.” These inflated amounts were then reported to the IRS and appeared on employees’ annual W-2 forms, the case explains, causing the workers “to have to pay more in taxes than they would have owed if the tips had been accurately reported.”