More than 750 ex-nightclub employees are entitled to damages from their former employers for being forced to make up cash register shortages from their tips, the Minnesota Supreme Court has ruled.
The high court’s ruling reverses the state Court of Appeals, which ruled in favor of now-closed party bars Drink and Spin Night Club. Minnesota state law forbids employers for making “any deduction, directly or indirectly, from the wages due or earned by any employee…” But The Appeals Court suggested that “wages” did not include gratuities.
Citing the dictionary, the Supreme Court disagreed:
A gratuity is a means of compensation because it is money “given or received as payment . . . for a service.” The American Heritage Dictionary 385 (3d ed. 1996). A gratuity is paid to an employee for performing a service for an employer, such as serving food and drinks to the employers’ patrons. Gratuities also fall under the definition of “wages” even though the money is paid by “another person.”
The matter is now in the hands of the Hennepin County District Court, where damages will be calculated for the plaintiffs. The Star Tribune reports that the award could surpass “six figures” and sets an important precedent for state labor law.