Lanzetta v. Florio's Enterprises, Inc.
763 F. Supp. 2d 615
S.D.N.Y.2011Background
- Lanzetta worked as a waitress at Florio's Restaurant in Little Italy from 2004 to 2008, and she claims she was paid only in tips with no regular wages.
- Florio's paid her taxes via a scheme where she covered taxes with her tip income, and the restaurant recorded a fixed weekly wage amount for withholding taxes, keeping the excess.
- There was no formal timekeeping system; shifts were logged informally, tips were pooled, and Lawrence Amoruso had significant managerial involvement in daily operations.
- Lanzetta testified to approximately 60 hours per week, 48 weeks per year, with long days and some days over ten hours, yet hours were not properly recorded.
- Plaintiff brought claims for unpaid minimum/wage and overtime under the FLSA and New York Labor Law, plus penalties for improperly retained tips; defendants denied wage payments and claimed she earned above minimum wage.
- The court found defendants failed to maintain required records and awarded damages including back wages, spread-of-hours premiums, and liquidated damages.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Are Florio's and related defendants liable for unpaid wages under the FLSA and Labor Law? | Lanzetta worked for tips only and was underpaid; employer failed wage records. | Lanzetta was paid wages; tips supported compensation; no wage violation. | Yes; liable for unpaid wages under both statutes. |
| Did defendants improperly retain Lanzetta's tips under the Labor Law § 196-d? | Defendants kept portions of Lanzetta's tips through the tax arrangement. | Tips and tax arrangements were proper or incidental. | Yes; retained amounts were improper and liable. |
| Is the FLSA claim time-barred or timely, and does willfulness apply to the statute of limitations? | Willful violations extend the limitations to three years; employee's claims should be timely. | Limitations should be two years unless willful; equitable tolling not warranted. | FLSA claims accrue within three years due to willfulness; equitable tolling not warranted. |
| Can the court consider Lawrence Amoruso an 'employer' under the FLSA? | Economic reality test supports holding Lawrence liable as an employer. | Only Florio and Ralph are liable as employers; | Yes; Lawrence is an employer under the broad FLSA definition. |
Key Cases Cited
- Moon v. Kwon, 248 F.Supp.2d 201 (S.D.N.Y. 2002) (burden-shifting and reliance on employer record-keeping obligations)
- Reich v. S. New Eng. Telecomms. Corp., 121 F.3d 58 (2d Cir. 1997) (evidence standards for proving wage violations where records are lacking)
- Mt. Clemens Pottery Co., 328 U.S. 680 (U.S. 1946) (employer liability and inference-based damages when records are incomplete)
- Herman v. RSR Sec. Servs. Ltd., 172 F.3d 132 (2d Cir. 1999) (economic reality, broad employer definition and control factors)
- Ansoumana v. Gristede's Operating Corp., 255 F.Supp.2d 184 (S.D.N.Y. 2003) (employer liability based on functional control rather than titles)
- Doo Nam Yang v. ACBL Corp., 427 F.Supp.2d 327 (S.D.N.Y. 2005) (burden-shifting when employer records are inadequate)
- Chao v. Vidtape, Inc., 196 F.Supp.2d 281 (E.D.N.Y. 2002) (corporate control and employer liability under FLSA)