EAST ST. LOUIS - Khalid Ramadan maintained an invalid tip pool at IHOP restaurants in O'Fallon and Alton and directed managers to delete hours, according to acting U.S. labor secretary Julie Su.
Her trial attorney Correll Kennerly of Chicago sued Ramadan at U.S. district court on June 11.
Kennerly requested an injunction against violations of fair labor law and sought compensation for employees plus liquidated damages.
He claims Ramadan acted willfully by failing to pay minimum wage and overtime and by failing to make and keep accurate records.
He claims Ramadan had notice about the law’s requirements by virtue of a prior investigation.
“To resolve it Ramadan paid back wages and agreed to pay the overtime premium rate for tipped employees and maintain a valid tip pool with accurate records," Kennerly wrote.
He claimed the labor department’s wage and hour division investigated compliance for a period from March 1, 2020 to Feb. 28, 2022.
For parts of the period Ramadan allegedly required front of house staff to put a percentage of their gross sales into a tip pool.
Ramadan allegedly kept the tips or shared them with back of house staff who would not customarily and regularly receive tips from customers.
The lawsuit claims Ramadan can’t credit tips towards his obligation to pay minimum wage and must pay the difference between the tipped wage and minimum wage to all who were paid as tipped workers in addition to paying them their tips.
Ramadan allegedly directed managers to delete hours when employees were close to 40.
Ramadan allegedly paid several employees the regular rate for hours beyond 40.
The suit also claims that if Ramadan violated the law after the investigation period the department would incorporate those allegations by reference.
Ramadan might owe additional back wages and liquidated damages.
The lawsuit includes names of 125 employees at IHOP on West Highway 50 in O'Fallon and 54 on Homer Adams Parkway in Alton.
According to the lawsuit, Labor Secretary Su is entitled to recover back wages and liquidated damages for three years.
On June 13 William Wurm of St. Louis County entered an appearance for Ramadan.
The clerk randomly assigned Chief District Judge Nancy Rosenstengel.
Resolution of the labor department's previous investigation didn't involve a suit at district court.
Sexual harassment charges from O'Fallon, Alton, two other Illinois locations and three in Missouri involved a suit at district court in 2017.
Ramadan and equal employment opportunity commissioners executed a consent decree in 2018, requiring him to terminate five employees.
He agreed to pay $75,000 to Brianne Timmons and $875,000 for distribution to others.