A Crowne Plaza Hotel in Massachusetts has been ordered to pay $1.3 million to settle a class action lawsuit over unpaid tips.
The settlement will resolve a 2009 class action lawsuit filed on behalf of 150 current and former employees who served customers at banquets between November 2006 and June 2010 at the Berkshire hotel. The class action lawsuit charged the hotel with withholding one-third of the 20-percent service charges billed to patrons at banquets.
The lead Plaintiff in the case, Anthony Chavarry, blew the whistle on the hotel after suspecting “something fishy” was going on when the accounting department could not give employees “a straightforward answer on how much we actually made for an event we worked.”
"We only make $2.63 an hour and the waitstaff relies on tips," he said, "so a substantial portion of our income was being skimmed off the top."
Under state law, only employees directly involved in service to customers are entitled to share tips, including waitpersons, bartenders and buspersons. Managers, sales staff and others are not entitled to any portion of gratuities.
The Crowne Plaza workers will share about $850,000 of the class action settlement, which still awaits final approval at a Fairness Hearing May 1. The amount of money the workers will receive will depend on the amount of time they were employed at the hotel during the Class Period. Some employees may see payouts in the tens of thousands of dollars, said an attorney representing the Class.
"The resolution of the case reflects the commitment of the Crowne Plaza that employees receive their full gratuities, and we commend them for reaching this settlement and ensuring that the full amount of money left by patrons goes to the staff," the attorney said.