The opinion of the court was delivered by: Nan R. Nolan United States Magistrate Judge
MEMORANDUM OPINION AND ORDER
Plaintiff Andrew Morgan filed suit on behalf of himself and a class of individuals similarly situated alleging that Defendants SpeakEasy, LLC, The Room of Chicago d/b/a South ("South"), and Jody Andre violated the Fair Labor Standards Act ("FLSA"), 29 U.S.C. § 201 et seq., and the Illinois Minimum Wage Law ("IMWL"), 820 ILCS 105/1 et seq., by failing to pay their wait staff minimum wages. Morgan also charges Defendants with unjust enrichment based on their practice of forcing employees to share tips with managers. On January 31, 2006, the district court approved the parties' Agreed Form of Notice to Similarly-Situated Persons Pursuant to 29 U.S.C. § 216(b). Morgan sent the notice to some 46 current and former employees of SpeakEasy and South, but none of them chose to opt-in to the case. Thus, Morgan is pursuing this lawsuit solely on his own behalf.
The parties consented to the jurisdiction of the United States Magistrate Judge pursuant to 28 U.S.C. § 636(c), and have now filed cross-motions for summary judgment on all of Morgan's claims. For the reasons set forth here, the motions are granted in part and denied in part.
SpeakEasy is an Illinois limited liability company owned by Defendant Andre and three other individuals not involved in this lawsuit. On June 3, 2003, SpeakEasy began operating as a restaurant called SpeakEasy Supper Club, located at 1401 West Devon in Chicago, Illinois.*fn1 (Def. Facts ¶ 1; Pl. Facts ¶ 2.)*fn2 South is an Illinois corporation licensed to do business as a restaurant in the city of Chicago. The restaurant, located at 5900 North Broadway in Chicago, first opened in April 2001 under the name The Room of Chicago. In August 2004, the restaurant began doing business as South, but subsequently closed its doors on January 1, 2006. (Id. ¶ 2.)
Andre was the sole owner and shareholder of South, and she managed and operated both South and SpeakEasy. (Id. ¶¶ 2, 3.) According to Andre, she conducted these management duties as an employee of Don't Speak, Inc., which hired her out as a consultant to the restaurants. (Id. ¶ 3; Andre Dep., at 97.) By approximately April 2005, however, Andre stopped receiving compensation from Don't Speak because SpeakEasy and South were doing poorly and she "chose not to take [a consulting fee]." (Andre Dep., at 100-02.) The parties agree that Andre was the "ultimate authority" at both SpeakEasy and South, responsible for the day to day operations of both restaurants, including hiring and firing employees; directing and supervising employee work; signing the corporations' checking and payroll accounts; and participating in decisions regarding employee compensation and capital expenditures. (Pl. Facts ¶ 8.)
Sometime prior to June 14, 2005, Morgan applied for a job as a waiter at SpeakEasy. Andre hired him to work as a server at South instead, beginning June 14, 2005 until he gave notice of his resignation on September 19, 2005, effective October 2, 2005. Morgan claims that he was also employed as a server for SpeakEasy and Andre at that time, but Defendants deny this assertion. (Def. Facts ¶ 4; Pl. Resp. ¶ 4; Pl. Facts ¶¶ 5, 9, 10.)*fn3 The parties also disagree as to the extent to which SpeakEasy and South were interrelated. Morgan claims that the restaurants shared employees on a weekly basis, including managers, servers, line cooks, and dishwashers. He also contends that the restaurants shared supplies, such as napkins, wine glasses, and bar napkins. (Pl. Facts ¶¶ 12, 13.) Defendants deny these assertions, but do not cite any supporting evidence. Andre testified, moreover, that several employees worked at both restaurants, and she acknowledged that it was possible that she had sent a busboy or dishwasher from one restaurant to the other to help cover no-shows. (Def. Resp. ¶¶ 12, 13; Andre Dep., at 59-60, 77.)*fn4
In any event, the parties agree that upon hiring new employees such as Morgan, Andre explained to them the restaurant's operations and procedures. She discussed how many shifts they wanted to work; what their first day would be like; what to wear; when training would occur and by whom; and what they would learn in their first few days. Andre also distributed a handout explaining the restaurant's opening and closing procedures, which was identical for both SpeakEasy and South. (Pl. Facts ¶ 11; Def. Resp. ¶ 11.) Andre insists that she also explained to the employees the restaurant's "well-known" policy that food ordered at the restaurant would be credited against the servers' compensation. (Def. Facts ¶ 13.) Morgan testified, however, that Andre never discussed a meal policy with him, and Andre herself could not recall any meetings during which she discussed the restaurant's rules regarding employee meals. (Morgan Dep., at 130-31; Andre Dep., at 118.)
B. Defendants' Payment Records
Defendants used several different records to keep track of the hours worked by each employee and the gratuities paid to them. At the close of business each night, the senior server completed a "Nightly Closing Form" identifying the name of each server present that evening and the tips each received. (Def. Facts ¶ 6; Def. Add'l Facts ¶ 42.)*fn5 In addition, Andre maintained Excel "Daily Sales Sheets" for South identifying each staff member working each night, the hours each worked, and the tips each received. (Id. ¶ 7.) Defendants claim that Andre also instructed servers to fill out time cards reflecting the number of hours they worked each week. (Id. ¶ 8.) Morgan denies this but admits that he kept time cards for his first few weeks of employment. (Pl. Resp. ¶ 8.)
Though Morgan admittedly stopped filling out time cards a few weeks after he started work, he apparently started keeping track of his time on his own beginning in late July or early August. Entries prior to that time were based on Morgan's memory, and he acknowledges that they are not entirely accurate. (Def. Facts ¶ 11; Pl. Resp. ¶ 11.)
C. Morgan's Compensation Plan
The primary dispute in this case is whether Morgan was paid the applicable minimum wage for all hours he worked as a server. Defendants claim that Morgan received the following forms of compensation during his employment at South: (1) regular wages; (2) tips; and (3) meal compensation.
Defendants claim that Morgan received "wages" each week as required by law. It is clear, however, that he did not always receive cash payments. In certain weeks, Defendants instead withheld amounts they characterize as wages "for payroll taxes." (Def. Facts ¶ 23.) Specifically, Defendants claim that South withheld Morgan's wages to cover taxes as follows:
$100 for the pay period of June 13 - 26 $140 for the pay period of June 27 - July 10 $110 for the pay period of July 11 - 24 $312 for the pay period of September 5 - 18 (Id. ¶¶ 23-29.) In support of this assertion, Defendants cite a 2005 W-2 Wage and Tax Statement indicating that South withheld a total of $662 in federal income tax, social security tax, medicare tax, and state income tax from Morgan's 2005 wages. (Ex. 15 to Def. Facts.)
Morgan disputes that South withheld any amounts for payroll taxes, noting that Andre did not testify to such an arrangement at her deposition. Morgan also argues that, if Defendants did withhold such amounts, they deducted more than he actually owed in taxes based on his income. (Pl. Add'l Resp. ¶¶ 56-58.)*fn6 Notably, Defendants have not provided any underlying documentation demonstrating the manner in which South calculated and/or applied the above payments towards Morgan's tax withholdings. Morgan, moreover, has submitted a Wage and Income Transcript from the Internal Revenue Service ("IRS") indicating that South did not pay any payroll taxes on Morgan's behalf in 2005 at all.*fn7 (Ex. A to Pl. Motion to Supplement; Pl. Supp. to Add'l Facts ¶ 13.)*fn8
Defendants find this omission irrelevant, noting that Morgan's W-2 form from South did not include his social security number because he repeatedly declined to provide it to them. (Andre Aff., Ex. 3 to Def. Facts, ¶ 9.) In Defendants' view, "any request for wage and tax statements from the IRS using Plaintiff's social security number [thus] would not include payments made by South."
(Def. Opp. to Supp. to Add'l Facts ¶ 7; Def. Resp. to Supp. to Add'l Facts ¶ 13.)*fn9 Defendants also claim that after South ceased operations in January 2006, the restaurant entered into a payment plan with the IRS regarding outstanding payroll taxes due, including tax payments for 2005. Defendants speculate that "[t]his payment plan likely superseded any wage and tax statements issued by the IRS for South." (Id. ¶ 8; Def. Resp. to Supp. to Add'l Facts ¶ 13.)
In other weeks, Morgan received cash payments, though the parties dispute that they constituted "wages." They also dispute when the wages were paid, and what hours of work they covered, as discussed later in this opinion.
SpeakEasy and South both used a tip pool for their servers, and each server was supposed to receive a pro rata share of the total tips based on the number of hours worked. (Def. Facts ¶ 15; Pl. Facts ¶ 19.) Morgan was employed as a regular, or junior, server, but SpeakEasy and South also employed senior servers who shared in the tip pool. Senior servers had more seniority and experience, as well as greater responsibilities within the restaurants. Specifically, senior servers helped with closing, occasionally served food and drinks to tables, served as greeters, and checked on tables during the dinner service. (Id. ¶ 14.) Defendants view senior servers as hosts or maitre d's, and emphasize that Andre retained the ultimate management authority. (Id. ¶ 16.) Morgan concedes that senior servers did not have authority over hiring, firing, or scheduling, but he believes they were managers nonetheless, stressing that their duties included directing and supervising employees' work; handling complaints; operating the restaurants' safes; handling money; completing the restaurants' Nightly Closing Forms; sending employees home; contacting Andre when the restaurant needed additional staff or supplies; taking inventory; and maintaining the restaurants' cleanliness. (Pl. Resp. ¶¶ 14, 16; Pl. Facts ¶ 23.)
It is undisputed that senior servers participated in the tip pool, and that they were paid an additional $20 per night for their work. (Def. Facts ¶ 14; Pl. Facts ¶ 24.) One of those senior servers, David Williamson, helped deliver food and drinks to tables and also served as a greeter. (Id. ¶ 17.) Morgan insists that Williamson performed these tasks in the capacity of manager, citing Williamson's affidavit that his job at South was "principally that of a supervising manager. That means that I was customarily the highest ranking employee at the restaurant when I was working and was generally in sole charge of the restaurant on those work days." (Williamson Aff. ¶ 4; Pl. Resp. ¶ 17.) Morgan notes, further, that Williamson had keys to the restaurant and "supervise[d] and direct[ed] the work of employees at South." (Id.)
Keila Herrington, another employee Defendants characterize as a senior server, had the same responsibilities as Williamson, but she also had a business card identifying her as a "manager." (Pl. Facts ¶ 26; Def. Resp. ¶ 26.) Andre acknowledged that Herrington "was a manager for a short time," but claimed that it was "more of a title than it was a responsibility." (Andre Dep., at 72; Def. Add'l Facts ¶ 50.) Herrington participated in the tip pool with the other servers. (Pl. Facts ¶ 27.)
On some occasions, South did not have enough money at the end of the evening to pay Morgan and the other employees their earned tips. When this occurred, the senior server would make a notation on the Nightly Closing Form indicating that certain employees were "owed" tips. Defendants would then pay the "owed" tips to employees at a future date, either in cash or with a check from one of the restaurants' operating accounts. (Pl. Facts ¶ 21.)
Defendants claim that Morgan also received compensation in the form of meals at the restaurants. According to Defendants, "[f]ood ordered at these restaurants is credited against servers' compensation," and "[t]he food items are valued by the cost of the food and production time." (Def. Facts ¶ 13; Def. Add'l Facts ¶ 46; Andre Dep., at 146.) Morgan acknowledges that he ate some meals at the restaurants, and that he could not eat meals there free of charge "any time" he wanted. Morgan insists, however, that he had no idea the meals he ate "while on the clock" were being credited against his compensation. (Pl. Resp. ¶ 13; Pl. Add'l Resp. ¶ 46; Morgan Dep., at 130, 134.) He notes, for example, that in the first few days of a new hire's employment, South chefs prepared complimentary dishes for the new and existing employees to taste. (Pl. Facts ¶ 32.) In addition, on June 15, 2005, Morgan ate food from South as part of his training. (Pl. Add'l Facts ¶ 11.)
Morgan also objects that the meal tickets Defendants produced reflect the retail cost, or menu price, of the meals. He further objects that Defendants do not know the actual cost of the meals he ate and have no supporting documentation. (Pl. Facts ¶¶ 33, 34.) Defendants reiterate that meal compensation was "valued by the cost of the food and production time; profits are not accounted for," but Andre conceded at her deposition that she had no idea as to the actual cost of the food Morgan ate. (Def. Resp. ¶ 33; Pl. Resp. ¶ 13; Andre Dep., at 210-15.) Defendants do not have any old menus from South indicating the retail prices of the items at issue. (Pl. Add'l Facts ¶ 12.)
D. Morgan's Hours of Work
The parties generally do not dispute the number of hours Morgan worked each week, as summarized below.
1. Morgan's Hours at South
The parties agree that Morgan worked the following hours at South between June 14 and September 19, 2005:
Week Ending Hours Worked Total Weekly Hours
June 19 4 hours on June 14 4 hours on June 15 8 hours ________________________________________________________________
June 26 8 hours on June 24 8 hours on June 25 16 hours ____________________________________________________________ ____
July 3 8 hours on July 1 7 hours on July 2 15 hours ________________________________________________________________
July 10 6 hours on July 6 8 hours on July 9 6 hours on July 10 20 hours ________________________________________________________________
July 17 6 hours on July 16 4 hours on July 17 10 hours ________________________________________________________________
July 24 3 hours on July 18 7 hours on July 22 7 hours on July 23 17 hours ________________________________________________________________
July 31 8 hours on July 29 6 hours on July 30 3 hours on July 31 17 hours
August 7 4 hours on August 3 6 hours on August 5 3 hours on August 7 13 hours
August 14 4 hours on August 10 2.5 hours on August 12 7 hours on August 13 3 hours on August 14 16.5 hours ________________________________________________________________
August 21 4 hours on August 17 4 hours on August 19 5 hours on August 20 3 hours on August 21 16 hours ________________________________________________________________
August 28 4 hours on August 24 3 hours on August 25 4 hours on August 26 4 hours on August 27 4 hours on August 28 19 hours
September 4 4.25 hours on September 1 6 hours on September 2 6 hours on September 3 3.75 hours on September 4 20 hours
September 11 4 hours on September 7 4 hours on September 8 5 hours on September 9 4 hours on September 10 3 hours on September 11 20 hours
September 18 3 hours on September 14 3.25 hours on September 15 4 hours on September 16 4 hours on September 17 5 hours on September ...