Issue January 15, 2013

Paradise lost

Kerfuffle at the now-defunct Lynn’s Paradise Cafe highlights vulnerability of service workers nationwide

For nearly a year, Leila DiFazio served the myriad customers who made Lynn’s Paradise Cafe one of the shining jewels in the city’s crown of so-called “weird,” independent businesses. With her dark auburn hair pulled back tightly into a ponytail, DiFazio, 25, sits at a table in a Heine Brothers Coffee shop and recalls her time slinging biscuits and grits in the land of ugly lamps and, as she and other co-workers allege, even uglier business practices — practices that reveal the vulnerability of service workers in the American workplace.

During a shift the day after the restaurant’s famed New Year’s Day Pajama Party, DiFazio says she refused to comply with a new policy that required servers to bring $100 of their own money to offset cashless credit card tips in order to tip out support staff such as bussers and hosts. DiFazio argued the policy put an undue financial burden on servers and that she could not afford to provide such a large amount of cash every shift; her fiancé Vince works in the kitchen at Norton Healthcare’s downtown hospital, and between them they support their 2-year-old son Demetri with another child on the way. When she told the restaurant’s chief operating officer, Patty Schnatter, of her intention to disobey the rule, DiFazio and another employee were reportedly fired.

“Patty said to me, ‘You are terminated for breaking policy rules,’” DiFazio says. “I asked her if I could be a hostess. Patty said that if I had contacted her before that day, it would have been possible, but not now.” DiFazio says she and others had talked about the new policy but were afraid to express their feelings to management. She adds that the new policy was announced in a series of memos posted throughout the restaurant less than two weeks before its start date, and that management did not sit down with employees to discuss the new monetary requirement.

Angered, DiFazio wrote a detailed post on WLKY’s Facebook page, which in turn ignited a firestorm in the local blogosphere.

Neither restaurateur Lynn Winter nor Schnatter responded to requests to be interviewed for this article. In a boilerplate statement sent to various media outlets via email, Schnatter voiced disappointment over the situation, which she blamed on former employees and third-party agitators.

In an interview with the food blog Eater Louisville on Jan. 4, Winter explained that the new policy, which she said she adopted from the Bob Evans chain of restaurants, would alleviate concerns among support staff and address fiscal requirements posed by national health care reform: “I tried to make a decision for the majority of the staff that would create a healthy atmosphere for them to go through the next years. That’s all I’ve done — I’ve tried to enact a situation in an uncertain world. We don’t know the policies of Obamacare.”

One week later, in an email sent at 1:46 a.m. on Friday, Jan. 11, Winter announced the restaurant was closing for good, with no further explanation.

“As of January 11, 2013 Lynn’s Paradise Café has closed its doors,” Winter wrote. “Thank you to all of our loyal customers and faithful employees for making it possible to run a 22-year business. It’s been a great run and we’ve had a ton of fun. The time has come to move on to new creative ventures.”

In the hours preceding the announcement, media reports surfaced that server Leila DiFazio and other former Lynn’s employees had met with members of Kentucky Jobs With Justice to form an awareness campaign, dubbed Service Workers For Justice. The website features the testimony of former employees who accuse the restaurant of sexual harassment, unfair wage practices, bullying, verbal abuse and more.

According to Kentucky Jobs With Justice Executive Director Flaco Aleman, Service Workers For Justice’s primary goal was to get DiFazio and other fired employees reinstated, to change the new policy, and to raise awareness for the plight of service workers across the city and the country.

“Had there been a union at Lynn’s, it probably wouldn’t have gotten to this point,” Aleman tells LEO Weekly. “In this industry specifically, where treatment like this is so commonplace, my hope is that other workers in the industry will see this and look at (the food service worker protests) in New York, Chicago and Miami … and think, ‘Why can’t this happen in Kentucky?’”

Indeed, service-sector workers like food servers comprise the largest and fastest-growing swath of post-recession American jobs. Typically identified as low-skill, low-wage, no benefits jobs with high-turnover, service-sector jobs account for roughly 80 percent of the United States’ private workforce, according to the Bureau of Economic Analysis. Data from the Bureau of Labor Statistics reveals that in 2011, service sector jobs including retail and foodservice comprised nearly 30 percent of all private-sector jobs in the Louisville Metro area — more so than any other category.

Despite their overwhelming numbers, most private-sector service workers don’t belong to a union, which Aleman says could have prevented this situation in the first place.

Trent Taylor, an attorney for the Kentucky Equal Justice Center specializing in employment law, says that based upon his interviews with former employees of Lynn’s Paradise Cafe, the restaurant could be seriously vulnerable to legal challenges based on state and federal labor laws.

He says the restaurant may have violated KRS 337.065, a state law that prohibits employers from forcing employees to pool their tips without the volition of the employee. Each time the restaurant required its employees to bring $100 to a shift, it could be counted as a separate and cumulative instance. Had the restaurant remained open and continued the policy, it could have potentially accrued thousands of dollars in back pay owed to servers as part of a civil damages suit.

Taylor also pointed out that under the Federal Labor Relations Act, the restaurant could be found guilty of retaliating against employees like DiFazio who spoke out against the policy.

Taylor, like Aleman, agrees that restaurant worker unions could prevent situations like the one at Lynn’s as well as protect workers at other less popular restaurants. For example, he spoke of a client who worked at a restaurant in the city who was underpaid. The client made just $225 per week in gross income despite working 70-76 hours a week. All because, he says, workers often cannot hold their employers’ collective feet to the fire when it comes to minimum wage laws — especially the myth of $2.13 an hour: Even if a server works for tips, their employer must make up any negative difference so that their hourly rate equals minimum wage, or $7.25 an hour.

“With respect to the (National Labor Relations Act) and organizing,” Taylor says, “restaurant workers, as you may already know, are very hard to organize because of the high turnover rate,” which he attributes in part to low wages and a lack of benefits. “You have to have a consistent basis of support for the continuance of a union, but the high turnover rate must be overcome.”

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