UPDATE 1-Darden hit with wage, discrimination claims

Wed Feb 1, 2012 1:06am GMT

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* Lawsuit focuses on Darden's high-end Capital Grille chain

* Alleges racial discrimination and wage violations

* Darden says company proud of its work environment

(Adds details on lawsuit, background, comment)

By Lisa Baertlein

Jan 31 (Reuters) - A group of Capital Grille workers sued Darden Restaurants Inc (DRI.N) in federal court in Chicago on Tuesday, accusing the restaurant operator's high-end steakhouse chain of racial discrimination and violations of state and federal labor laws.

The lawsuit seeks class-action status and was brought by current and former employees in New York, Illinois and Maryland, most of whom are members of Restaurant Opportunities Centers United (ROC). The action pits that vocal advocate on industry wages and working conditions against one of the largest U.S. restaurant companies.

Darden spokesman Rich Jeffers said the company is proud of the work environment it creates for employees. "We continue to believe these allegations are baseless. However, as with any claims of impropriety, we will investigate them thoroughly," Jeffers said.

The complaint charged that Capital Grille discriminated against non-white workers in its hiring, disciplinary practices, work assignments and promotions.

Some black servers said they were unfairly targeted for disciplinary action and ultimately terminated because they "did not fit the Capital Grille image."

Employees claim that white workers at Capital Grille are more likely to have lucrative "front-of-house" positions such as waiter or bartender, while many lower paying "back-of-the-house" jobs like prep cook and dishwasher are given to non-whites.

The wage claims include allegations that Capital Grille forced employees to work "off-the-clock" before or after their shifts, failed to pay federally mandated minimum wage and required tipped employees to share tips with non-tipped workers, including people who wash dishes and polish silver.

Among other things, the lawsuit seeks unpaid overtime with applicable interest, attorneys' fees and damages available under the Civil Rights Act. "We're trying to send a signal to the industry that this kind of wage theft and discrimination is not acceptable," ROC co-founder Saru Jayaraman said.

Darden, best-known for its Olive Garden and Red Lobster chains, is the nation's largest full-service restaurant operator, with more than 1,900 outlets and about 179,000 employees in the United States and Canada.

Led by Clarence Otis, one of the few black chief executives to be at the helm of a large U.S. corporation, Darden was included in Fortune magazine's list of "100 best companies to work for" in 2011 and 2012.

The company's roughly 45 Capital Grille steakhouses are the most upscale eateries in the company's portfolio.

While unfair pay practices occur in many industries, workers in restaurants, hotels, construction, janitorial and home health care are among the most vulnerable, a Department of Labor spokeswoman told Reuters.

Atlanta attorney Amanda Farahany said restaurants are more likely to commit violation of laws covering wages, sexual harassment and discrimination. At the same time, they are less likely to be sued because the high-turnover industry is dominated by young workers who may not know their rights.

"People are more likely to leave the restaurant and get another job," said Farahany, whose firm has been involved in unrelated litigation against Darden.

ROC, which organizes workers but is not a union, says its mission is to improve compensation and working conditions for low-wage restaurant employees.

Its other targets have included Smith & Wollensky and celebrity chef Mario Batali's Del Posto restaurant in New York City.

ROC said it has achieved agreements awarding $5 million to restaurant workers who faced illegal treatment since it was founded in 2001.

(Reporting by Lisa Baertlein in Los Angeles; Editing by Matt Driskill, Gary Hill)

((lisa.baertlein@thomsonreuters.com)(+1 213 955 6742)) Keywords: DARDEN/

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