United States District Court, N.D. Illinois, Eastern Division
MEMORANDUM OPINION AND ORDER
MATTHEW F. KENNELLY UNITED STATES DISTRICT JUDGE.
Perez has sued his former employer, Over-Easy, Inc., d/b/a La
Escarola (La Scarola),  its president Joseph Mondelli, and its
manager Armando Vasquez, for violations of the Fair Labor
Standards Act (FLSA). Perez worked for La Scarola as a
restaurant server. He alleges that the defendants violated
the tip-credit and retaliation provisions of the FLSA. The
defendants have moved for summary judgment. For the reasons
stated below, the Court grants the defendants' motion.
following facts are undisputed except where otherwise noted.
Over-Easy is an Illinois corporation that operates a
fine-dining Italian restaurant in Chicago called La Scarola.
Mondelli serves as the corporation's president, and
Vasquez manages the restaurant. From approximately 2012 until
2017, Perez worked as a server there.
many restaurants, servers at La Scarola earn wages and tips.
During the relevant timeframe, the restaurant operated a tip
pool through which it required servers to pay a percentage of
their tips to the bartender and busboys each night. Before
starting his job, Perez knew that La Scarola required him to
contribute to the tip pool. Perez Dep., Ex. 4 to Defs.'
Statement of Undisputed Material Facts (SUMF), dkt. no. 45-4
at 52:5-14. He testified that he paid 10 percent of his tips
to the bartender and 20 percent to the busboys. Id.
at 21:3-8. Unlike tips paid in cash, credit card tips
would take a few days to process. Perez testified that on
nights when he did not earn enough in cash tips to cover the
amount owed to the bartender and busboys, he had to pay them
with his own, out-of-pocket cash. Id. at 103:5-18.
end of each night, the servers calculated and recorded their
tips, including their total earned tips, their cash tips, and
the tips they paid to the bartender and busboys. A few days
after servers earned credit card tips, La Scarola gave them a
check payment for those tips. After each weekly pay period,
it paid them their hourly wage by issuing a separate check.
Scarola deducted tax withholdings from its servers'
paychecks. Perez testified that La Scarola taxed the total
amount of tips he earned, rather than taxing only the tips he
retained after paying the bartender and busboys.
E.g., id. at 16:16-22. As a result, he
claims, La Scarola deducted more taxes than he owed.
E.g., id. But despite this alleged
over-taxation, Perez testified that he still earned minimum
wage. Id. at 16:23-25.
parties dispute whether Perez complained to Vasquez or any
other supervisor about the allegedly excessive tax
withholdings. Perez testified that he initially did not
"do anything" about the alleged over-taxation
because he did not want to lose his job. Id. at
58:9-13. But at some point, Perez said, he asked Vasquez for
his money and "why they were taking" his money.
Id. at 58:14-17. He told Vasquez that he did not
want to be taxed "on the tips [he] wasn't
making." Id. at 110:13-16. Vasquez has stated
in an affidavit that Perez never complained to him
"about not being paid properly or having too much in
taxes withheld from his pay." Vasquez Decl., Ex. 1 to
Defs.' SUMF, dkt. no. 45-1 at ¶ 15.
2017, Vasquez fired Perez. The defendants say that Perez was
fired for insubordination because he refused to follow
Vasquez's direction to assist another server in cleaning
a table and became argumentative. Perez contends that this is
a pretext and that the real reason for his termination was
retaliation for his complaints about his pay.
sued the defendants for violations of the FLSA, the Illinois
Minimum Wage Law, and the Illinois Wage Payment and
Collection Act. The defendants moved to dismiss Perez's
claims, and the Court granted the motion to dismiss for all
but the FLSA claims. The remaining claims are count 1,
alleging violations of the FLSA's tip-credit provision,
29 U.S.C. § 203(m), and count 2, alleging a violation of
the FLSA's retaliation provisions, id. §
215(a)(3). The defendants have moved for summary judgment.
judgment is proper where there are no genuine issues of
material fact and the movant is entitled to judgment as a
matter of law." Richardson v. Chi. Transit
Auth., 926 F.3d 881, 886 (7th Cir. 2019) (internal
quotation marks omitted). In considering a motion for summary
judgment, the Court construes all facts and draws all
reasonable inferences "in favor of the party against
whom the motion under consideration was filed."
Id. The party opposing summary judgment "must
present specific facts showing that there is a genuine issue
for trial; inferences that rely upon speculation or
conjecture are insufficient.” Aguilar v.
Gaston-Camara, 861 F.3d 626, 630-31 (7th Cir. 2017)
(internal quotation marks omitted). "A genuine issue of
material fact arises only if sufficient evidence favoring the
nonmoving party exists to permit a jury to return a verdict
for that party." Hanners v. Trent, 674 F.3d
683, 691 (7th Cir. 2012).
FLSA "is designed to protect workers from the twin evils
of excessive work hours and substandard wages."
Howard v. City of Springfield, 274 F.3d 1141, 1148
(7th Cir. 2001). Toward that end, it requires employers to
pay their employees a minimum wage for each hour of work
performed. 29 U.S.C § 206. Subject to certain
requirements, an employer may pay a reduced hourly wage to a
"tipped employee"- one who "customarily and
regularly receives more than $30 a month in tips"-by
crediting the employee's tips, up to a certain amount,
toward his minimum wage. Id. §§ 203(m)
& (t). An employer may take this tip credit only if it
has informed the tipped employee of the relevant subsection
of the FLSA. Id. § 203(m)(2). Additionally,
"all tips ...