Restaurant Chain in Iowa City Accused of Skipping Wages for Servers

The federal government is suing a chain of Mexican restaurants based in Iowa City for allegedly paying some of its employees only with the tips from customers.

Which Restaurant Chain in Iowa City is Being Sued?

The Cedar Rapids Gazette reports that a lawsuit filed in U.S. District Court, the U.S. Department of Labor is alleging that 33-year-old Rocio Correa-Mata of Iowa City violated the Fair Labor Standards Act. Correa-Mata is the owner and primary manager of the Mexico Lindo Grill and Cantina restaurant chain. There are Mexico Lindo locations in Iowa City, North Liberty, and West Branch.

What Is the Restaurant Being Sued For?

According to the lawsuit, servers at the restaurants were only paid via cash or credit tips from customers, and not the federal minimum wage of $7.25 per hour, according to the Gazette. The chain of restaurants is also accused of paying employees less than the statutory overtime rate of 1.5 times regular hours for all hours worked in excess of 40 hours per week.

The Gazette reports that the lawsuit also states that Correa-Mata failed to create and maintain accurate records of employees' hours and failed to document each worker's name and social security number.

What Does the Government Want to Do Next? 

The Department of Labor is seeking a court order to stop Mexico Lindo from continuing to withhold unpaid minimum wages and overtime compensation, according to the Gazette. The lawsuit also seeks to find the chain liable for any unpaid wages, plus damages, to 25 different employees at three Mexico Lindo locations.

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