Labor cost control is a vital consideration for restaurant owners and managers, equally as critical is adherence to current restaurant labor laws. Violation of labor laws can result in fines, lawsuits, and in worse case scenarios, can even put you out of business.
Here are some restaurant labor laws that affect your business, and what you need to know to stay compliant.
Minimum Wage Laws
Labor costs are high on your priority list, but you need to be sure controlling costs does not violate minimum wage laws.
- You must pay workers the federal minimum wage of $7.25 per hour unless your state requires a higher wage.
- For servers and bartenders, who receive tips, you can consider that part of their wages. However, you must ensure that you still pay them at least $2.13 an hour no matter how much they make in tips.
- You cannot require workers to pay for cash shortages, customer walk-outs, or uniform purchase if it results in a wage drop below the minimum.
Overtime Pay
As a restaurant owner, you put in much more than the normal 40 hours per week. If any of your employees do the same, keep these rules in mind:
- You are required to pay overtime to any hourly worker who puts in over 40 hours per week.
- Non-tipped employees receive one and a half times their regular rate of pay for any hours over 40.
- Tipped employees receive one and a half times the applicable minimum wage, not the $2.13 you pay them before factoring in tips.
Meal and Rest Breaks
There are no federally mandated meal and rest breaks for private employers. However, each state has its own laws that employers must abide by. These range from no breaks legally required in states like Arkansas and Nebraska, to extensive rules in states such as New York and Massachusetts.
Youth Labor Laws
Many restaurant owners enjoy giving young adults their first job in the kitchen or as a busser. Keep these rules in mind if you employ anyone under the age of 17.
- Workers who are 14 and 15 can work in non-hazardous jobs, but the number of hours they can work is limited.
- Those who are 16 can work an unlimited number of hours, but must be in a non-hazardous position.
- As a reminder, hazardous jobs in the kitchen involve anything with dangerous equipment such as meat slicers, baking equipment, or mixers. Non-hazardous jobs include clearing tables, assisting chefs if no dangerous equipment is involved, and hosting.
To ensure compliance with restaurant labor laws, many owners turn to online platforms specifically designed for managing restaurants. These solutions can save you time and money.
Running a successful and reputable restaurant means simultaneously complying with regulations and controlling costs. Keep up-to-date on how the law applies to you and consider using software that can act as your virtual assistant.