Sacramento taco chain withheld overtime from workers, kept part of their tips, feds say

The U.S. Secretary of Labor has filed a complaint against the owners of Sacramento’s Garibaldi Mexican restaurant chain, alleging they failed to pay proper overtime, kept part of workers’ tips and pressured employees not to cooperate once federal investigators began looking into problems at the restaurants.

The complaint, filed by Labor Secretary Martin Walsh in federal court in Sacramento late Wednesday, claims violations under the Fair Labor Standards Act at the Taqueria Garibaldi chain’s restaurants on Howe Avenue near Alta Arden Expressway and El Camino and Watt avenues in Arden Arcade, and a third eatery in Roseville on Fairway Drive.

The 12-page complaint names the Che Garibaldi company, restaurant owners Eduardo Hernandez and Hector Manual Martinez Galindo and Howe Avenue restaurant manager Alejandro Rodriguez, and says the chain employs more than 20 workers but deprived their workers of the wages they earn.

“A number of employees work over forty hours per week, some working over twelve hours per day,” the complaint says. “Defendants hired several employees to work in one position, but expect employees to perform a multitude of tasks once employed.

“For example, employees hired as servers were also instructed to cut vegetables; prepare meals; clean floors, windows, mirrors, and the bathroom; and operate as the cashier.”

The complaint says the chain paid workers by check for up to 40 hours of work, but paid cash for any overtime and failed to pay an overtime rate of 1½ times the regular salary. The complaint also alleges supervisors and managers were allowed to keep a portion of workers’ tips and that it failed to “maintain accurate records of hours worked by and wages paid to their employees.”

The Labor Department also says that when its Wage and Hour Division investigators began looking into practices at the restaurants last year Garibaldi “impeded” the probe.

“As soon as the defendants were notified of the investigation, but before WHD had the opportunity to visit the worksites and speak with employees, defendants verbally instructed workers to communicate to WHD investigators that employees only worked forty hours a week and eight hours a day, were provided two days off and thirty-minute breaks, and were paid only in checks,” the complaint says. “Defendants reminded employees on several occasions of these instructions.

“Defendants warned employees that if defendants had to pay overtime premiums by check, then employees would lose more money in taxes. Defendants further insisted on a quid pro quo, communicating to employees that because defendants provided them with wages and jobs, then they should provide defendants with the favor of misleading WHD as instructed.”

Hernandez, who is listed in public records as the chain’s president, did not immediately respond to a message left at his home Thursday or at the Roseville restaurant. A worker at the chain’s main restaurant on Howe Avenue hung up twice Thursday morning when The Bee asked to speak to Hernandez or the manager.

Last year, the Sacramento restaurant was among several accused by the California Department of Alcoholic Beverage Control of violating COVID-19 restrictions.

The latest complaint by federal labor investigators says that once Garibaldi official learned of the probe they instructed workers to stop using a time clock device called uAttend in all three restaurants and instead manually fill out a yellow time card for 40-hour work weeks.

“Defendants instructed employees to record hours worked over forty on a separate piece of paper so that defendants could calculate cash payments at a straight-time rate for these hours,” the complaint says. “Defendants communicated to employees that hours and pay had to be processed this way because the uAttend machines were broken at all three restaurant locations.

“While the Secretary’s investigation was ongoing, defendants provided employees, who had recorded hours in excess of forty on the yellow time cards, with a new stack of time cards to retroactively write forty-hour work weeks for past pay periods. For some employees, the number of time cards that defendants instructed them to rewrite was so extensive that employees had to continue rewriting the time cards after work hours and at their homes.”

The complaint says that “by interfering in the Secretary’s investigation by pressuring employees not to provide accurate information to the Secretary” the chain “retaliated against employees seeking rightful wages and tips.”

The department’s lawsuit seeks payment of “all wages due, including overtime and tip compensation, from at least May 7, 2018, through the present,” reimbursement of the costs of the investigation and “any other relief” the court may order.

This story was originally published May 5, 2022 at 10:17 AM.