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Moulton v. W.W.I., Inc.

United States District Court, M.D. Alabama, Southern Division

August 5, 2019




         This matter comes before the court on Plaintiffs Meghan Moulton, Kiana Rivers, Stephanie Griffin, and Victoria Searcy's (the “employees”) motion for partial summary judgment. (Doc. 27). Upon consideration, the motion is GRANTED.


         Defendants W.W.I., Inc. and William W. Ingram (the “employers”) operate three restaurants in Dothan, which they refer to as the North, South, and West side stores. (Doc 26-1 at 5). Ingram is the “sole owner” of W.W.I., Inc., although there was also an employee shareholder while the employees worked for him. (Doc. 26-1 at 5). Ingram was “the individual that turned the hours worked in to an outside payroll service called Apex.” (Doc. 26-1 at 7).

         Upon hiring a new server, the employers would tell the servers that they would be paid $2.15 per hour, “[a]nd the tips that they earn will be reported” because the employers planned to take a “tip credit.” (Doc. 26-1 at 41). Ingram decided to pay $2.15 rather than the $2.13 required by FLSA because he “wasn't going to fool with the two cents.” (Doc. 26-1 at 20).

         The employees allege that the employers deducted uniforms, customers' beverages, and missing silverware from their base wage, which improperly lowered their wage beneath the $2.13 required by FLSA. (Doc. 27 at 4, 8). The employees are charged for their initial uniforms, three shirts and two aprons, and any replacements. (Doc. 26-1 at 25). Ingram acknowledged that both the initial and replacement uniform purchases were deducted from their pay. (Doc. 26-1 at 25). The employers require the servers to put what beverage each customer is drinking at the top of the ticket. (Doc. 26-1 at 17). The employers notified the employees that if they failed to do so, the employers would take the beverages out of their individual paychecks. (at 17). But the employees could be reimbursed the $2.50 drink deduction per customer if they remembered the table drank. (Doc. 26-1 at 19). In hindsight, Ingram said that “[t]he right choice probably would've been just to terminate them, ” but they were having trouble keeping servers. (Doc. 26-1 at 18). As for the silverware, Ingram said he “might” have heard about such deductions, but he would be surprised to learn that it had occurred at his restaurants. (Doc. 26-1 at 22-24).

         When confronted with the employees' allegations, Ingram repeatedly acknowledged the illegality of his conduct: “Q. You take their beverage money away from them, which is illegal if you're [sic] counsel hasn't advised you already. A. Yeah. I'm just trying to change behavior, trying to get them to charge for it. They have bad habits.” (Doc. 26-1 at 37). And again:

“Q. So the money is coming out of somewhere, and the only other money you're paying them is the 2.15 per hour subminimum wage rate, right? A. Yeah. Q. So it's coming out of that? A. Yeah. It has to. It's the only thing left. [(Doc. 26-1 at 41)]
“Q. And did Bailey, when she was training individuals, tell them that it was illegal for you-all to put them below the minimum wage -- A. Yes. Q.-- and to deduct from that 2.15 per hour? A. Yes. Q. So you-guys knew what you were doing was illegal? A. Which part? Q. Deducting the beverages from the 2.15 per hour rate. A. I don't think that thought process entered our minds that it was illegal. We were just trying to change their behavior. Q. Well, you -- A. I don't think that was a conscious thought.”

(Doc. 26-1 at 42). And a third time:

“Q. But if it was to get bad again and it would be economically feasible, you would reinstitute the policy? A. No, not after this meeting. Q. Why? A. Because you just told me it was illegal. We would … write them up, take disciplinary action against them or coach them and counsel them how to avoid it, advise their supervisor to check behind them.”

(Doc. 26-1 at 42).

         In their briefing, neither party provided much support for their respective positions. The employers provided an employee manual, but later acknowledged that it was not the correct edition. (Doc. 26-1 at 25). And due to a hard drive crash, the data for the North side store was lost. (Doc. 26-1 at 15). The status of the other stores' data is unclear. Ingram remembered attempting to recover the employees' data from the south and west side stores, but he could not remember whether he was successful. (Doc. 26-1 at 15). Later, Ingram said he “honestly, truthfully can't recall trying to search for” the west side's data. (Doc. 26-1 at 44). But he also said, “I could contact Apex and have them print me up beverage charges through their software. They could print me a report on uniforms that was deducted from the individuals.” (Doc. 26-1 at 18).

         Aside from the computer failure, it seems that the employers' recordkeeping left something to be desired, not even tracking their employees' cash tips: “Q. Do you know what the average tips are for cash or is that not -- do you track that? A. No, we don't track that. I have no way of telling.” (Doc. 26-1 at 44).

         Ingram's plan to make up for the missing evidence about the hours worked was “[w]itnesses. These four plaintiffs are the only persons that I am aware of that ever had a complaint in the 26-year history of our company. And I can talk to my present employees I've got and the ones from the past ….” (Doc. 26-1 at 37). Ingram guessed that interviewing these witnesses would show “very few complaints or problems.” (Doc. 26-1 at 37). So, Ingram proposed using “other people's testimony and other people's information and … information I'm aware that I can get from Apex.” (Doc. 26-1 at 38).

         The employers, however, were ultimately able to provide payroll information from Apex. Griffin worked 29 hours 53 minutes of overtime, Rivers 0 hours 0 minutes, Searcy 5 hours 30 minutes, and Moulton 12 hours 9 minutes.[1] (Doc. 29 at 11, 17, 20, 26). The payroll information also shows “miscellaneous pay” and beverage and uniform deductions. Griffin received $60.74 in miscellaneous pay, Rivers $0.00 Searcy $92.00, and Moulton $118.00. (Doc. 29 at 11, 17, 20, 26). Griffin's beverage deductions were $61.00, Rivers $34.50, Searcy $67.50, and Moulton $50.50. (Doc. 29 at 11, 17, 20, 26). Griffin's uniform deductions were $22.00, Rivers $49.00, Searcy $45.00, and Moulton $56.00. (Doc. 29 at 11, 17, 20, 26).

         “Miscellaneous pay” was given either for error correction or to avoid paying for overtime work by allowing the employees to work off-the-clock. (Doc. 26-1 at 11).

“Q. And so why would you make them not work the shift? A. Because of the overtime pay. It's just-it's almost an industry standard in not letting servers work their overtime pay. Q. Yeah. But you're letting them work. You're not just not letting the hours accrue. A. That's correct. Q. And that makes it better to you? That makes it legal to you? A. I don't know. ...

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