4 Best Practices to Maintain Restaurant Compliance with US Labor Laws and Regulations

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Learn 4 best practices to maintain restaurant labor law compliance and avoid costly penalties from Ctuit Software employee and restaurant industry expert, Amanda Wilkening.

So how does a company ensure their restaurant is in compliance with U.S labor regulations?

Just as people would trust their health with a doctor, the government trusts restaurant owners with labor integrity. Shockingly, in a recent article released by Restaurant Business Online, 95% of Restaurants in Austin, Texas, that were audited were not in compliance with the federal government’s wage and hour regulations during an 8-month period in 2015-2016.

Only 5% of restaurants in this study were accurately accounting for wages owed to employees in cases such as tipped minimum wage. Imagine the magnitude of restaurants outside of Austin that are in violation. This creates a potential catastrophe for the reputation of the restaurant industry.

So how does a company ensure their restaurant is in compliance with U.S labor regulations?

1. Know the difference between Labor Laws and Labor Rights.
Labor Laws- These laws originated to protect employees from unethical work and compensation correlations. Labor laws vary around the world in complexity and amount. The industrial revolution and its uncanny working conditions were the main ingredient to the tough U.S labor laws that exist today. Key labor laws address items such as number of hours an employee can work, ages for employment, medical leave acts, and minimum compensation. Additional state and local labor laws may also exist that pertain to particular wages and working conditions.

Labor Rights- Labor rights are similar to labor laws; however, labor rights provide employees with security. These rights include the right to breaks, the right to report unhappy working conditions, the right to timely pay and, most importantly, the right to unionize. Thus, allowing for the democratic voice of workers to their employers. Labor rights are a necessity to ensure labor laws are being obeyed.

2. Be aware of the Laws and Rights.
Labor laws and rights are constantly evolving and multiplying. Restaurants must on stay top of these. Knowing these laws and rights will be the key to avoiding violations such as the ones our friends in Austin received. The United States Department of Labor website is a great resource in aiding in this knowledge. Keep updated prints of the labor laws and rights posted throughout the restaurant. Teams and managers need to review these so that they can further discuss them with employees.

3. Listen to Employees.
No one will pay more attention to laws being obeyed and rights being addressed than the restaurants’ employees. From the perspective of the employee, they want to ensure they are receiving the right pay, benefits, and breaks that they are entitled to from their work. If an employee voices concern, the company needs to take the time to investigate their claim. It is best to identify the error and correct it. Even if the claim turns out to be erroneous, it is better to investigate the claim than it is to be out of compliance.

4. Audit the Restaurant before the Department of Labor Does.
There are many different auditing platforms out there that a restaurant can use as a resource to ensure compliance during the year, such as software programs, consultants, and third party labor contractors. These platforms may come with a sizeable expense; however, in relation to the cost of violations and back pay, this expense can be microscopic.

U.S Labor laws and rights are vastly complex and at times rather tedious. However, without employees, the restaurant and service industry would cease to exist. To keep employees, restaurants must compensate them according to their work. The government recognized this when they created the modern labor laws in the 19th century. Now restaurants are trusted to protect their employees with these laws and rights. In return, employees can trust their employers.

For more information about Restaurant Labor Compliance, visit http://www.ctuit.com.

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Megan McIntyre
Ctuit Software
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