United States District Court, N.D. Illinois, Eastern Division
MEMORANDUM OPINION AND ORDER
I. Shadur Senior United States District Judge
Basina ("Basina") and Mikhail Ruiz
("Ruiz") have sued their former employer, Sushi
Thai, a restaurant in Libertyville, Illinois under the Fair
Labor Standards Act ("FLSA") (29 U.S.C.
§§ 201-219) and the Illinois Minimum Wage Law
("Illinois Law") (820 ILCS 105/1-105/15).
Plaintiffs have filed motions for partial summary judgment on
the ground that they were underpaid for the hours they worked
in violation of those state and federal minimum wage laws.
Thai is owned by Mutjarin Nakanant, who goes by the name
"Cathy" (C. Dep. 7:23-8:9). Cathy's youngest son
Manocha Nakanant, who goes by the name "Mike, " and
his wife Heather Basina ("Heather") manage the
restaurant along with Cathy (M. Dep. 4:14, 6:17-18, 9:12-21).
Heather is the sister of one of the plaintiffs, Fabina Basina
("Basina") (C. Dep. 11:18-20). At certain times
Heather, Mike and Basina paid Cathy rent to live in a house
that she owned (C. Dep. 40:2-12).
was employed as a tipped server/waiter, and he was paid at a
reduced hourly rate (called a "tip rate") of $5 (P.
St. ¶¶ 3, 6). Sushi Thai operated a "tip
pool" under which tips were collected and distributed
according to a predetermined formula at the end of each shift
(P. St. ¶ 7). Mike, the manager, calculated and recorded
tip pool distributions each day (M. Dep. 49-53). Mike
testified that at the end of a shift all tips are pooled, and
the restaurant first deducts 5% to cover the asserted cost of
processing credit cards (M. Dep. 36:8-17). Then 15% of the
tips are given to the sushi bar employees, with 20% of that
sum going to the kitchen (M. Dep. 33:13-19), after which 15%
of what remains in the total tip pool is given to the busboy
(M. Dep. 35:22-36:1). Finally the servers split what remains
of the tips after those distributions (M. Dep. 24:6-12).
Sushi Thai guaranteed servers $95 per day, or $60 for the
dinner shift and $35 for the lunch shift -- and in the event
servers' tips came up short, the restaurant made up the
difference (M. Dep. 59:7-62:22).
was employed as a Sushi apprentice, and he was paid at a rate
that corresponded to the hours he worked each week, which the
restaurant characterized at times as a "day rate"
(Amended Answer [Dkt. No. 32] ¶ 1; P. St. ¶¶
12, 13). But Basina's pay and hours worked are
not entirely discernable from the record for several reasons.
in Basina's case Sushi Thai did not comply fully with
provisions of the FLSA or its implementing regulations that
require employers to keep contemporaneous records of wages
and hours (29 U.S.C. § 211(c) -- quoted next -- as to
the FLSA and 29 C.F.R. §§ 516.1, 516.2, 516.5 and
516.6 as to the regulations):
Every employer subject to any provision of this chapter . . .
shall make, keep, and preserve such records of the persons
employed by him and of the wages, hours, and other conditions
and practices of employment maintained by him, and shall
preserve such records for such periods of time . . . as
necessary or appropriate for the enforcement of the
provisions of this chapter or the regulations . . .
Sushi Thai appears to have had an informal arrangement with
Basina as to his wages and hours. Cathy and Mike testified
that they paid Basina a rate of $100 per day ($110 on
weekends), a number that was assertedly based on a 40 hour
work week at minimum wage per hour (Am. Ans. ¶ 1; C.
Dep. 47: 5-8; M. Dep. 56:5-14).
rate of pay is listed as a "salary" of $26, 520 in
Sushi Thai's tip pool records (S. Exs. C, D), and as $24,
440 on the employee contact list generated May 31, 2012 (S.
Ex. D [Dkt. No. 78-4] at 32),  but Sushi Thai later stipulated
that Basina was for all intents and purposes a by-the-hour
employee (Am. Ans. ¶ 1). Sushi Thai also submitted
weekly emails from its manager Mike to the restaurant's
accountant that show Basina was paid varying dollar amounts
each week between 2012 and 2014, but neither the emails nor
Basina's paychecks indicate the hours worked during those
weeks (S. St. ¶14; S. Ex. F). Further complicating
matters, Cathy testified (1) that she lent Basina large sums
of money and deducted varying amounts from those paychecks to
repay the loans and (2) that she deducted small amounts of
rent from Basina's paychecks that he owed her to live in
a house she owned (C. Dep. 34: 7 - 40:12). Sushi Thai did not
reflect Basina's repayments and loans to and from the
restaurant's owner in its records.
is only one indication in the record of Basina's hours:
an email dated February 11, 2016 from Mike to his lawyer that
reconstructs estimates of the hours Basina worked between
December 1, 2012 and February 21, 2014 based on documentation
of his weekly paychecks (P. Ex. 5). As to that email Sushi
Thai admits that "Manager 'Mike' calculated the
amount of hours Plaintiff Basina worked based on the
paychecks, " but it is silent on the accuracy of his
estimates (S. St. ¶16).
Rule 56 movant bears the burden of establishing the absence
of any genuine issue of material fact (Celotex Corp. v.
Catrett, 477 U.S. 317, 322-23 (1986)). For that purpose
courts consider the evidentiary record in the light most
favorable to nonmovants and draw all reasonable inferences in
their favor (Lesch v. Crown Cork & Seak Co., 282
F.3d 467, 471 (7th Cir. 2002)). Courts "may not make
credibility determinations, weigh the evidence, or decide
which inferences to drawn from the facts" in resolving
motions for summary judgment (Payne v. Pauley, 337
F.3d 767, 770 (7th Cir. 2003)). But a nonmovant must produce
more than "a mere scintilla of evidence" to support
the position that a genuine issue of material fact exists
(Wheeler v. Lawson, 539 F.3d 629, 634 (7th Cir.
2008)) and "must come forward with specific facts
demonstrating that there is a genuine issue for trial
(id.). Ultimately summary judgment is warranted only
if a reasonable jury could not return a verdict for the
nonmovant (Anderson v. Liberty Lobby, Inc., 477 U.S.
242, 248 (1986)).
contends that Sushi Thai's practice of deducting 5% from
the tip pool before distributing to servers violates the
legally relevant provisions and that Sushi Thai should
therefore be prohibited from claiming state or federal tip
credit exemptions (S. Mem. 2). Under the FLSA and the
Illinois Law an employer may offset its minimum wage
obligations with tips that its employee actually receives if
that employee regularly receives gratuities (Section 203(m);
Illinois Law § 4(a)(1), (c)). But an employer may not
claim the federal tip credit ...