Long John Silvers

We are investigating whether salaried Restaurant General Managers and Assistant Restaurant Managers who work(ed) for Long John Silvers, Inc. in any of its more than 700 company-owned fast seafood restaurants throughout the United States have been wrongfully denied overtime pay in violation of the Fair Labor Standards Act.

Background on Overtime Law

The Fair Labor Standards Act (FLSA) allows salaried restaurant managers to be exempted from overtime pay only if they are paid on a salary basis as defined by the FLSA regulations. An employee is considered to be paid on a salary basis if he or she regularly receives each pay period a predetermined amount constituting all or part of their compensation. This amount cannot be subject to reduction because of variations in the quality or quantity of the work performed. Generally, a manager will not be paid on a salary basis if his or her employer makes deductions from their salary based on the amount of work they perform during the workweek (the employer generally must pay the full weekly salary if the salaried employee works any part of the week) or makes disciplinary deductions in partial week increments; or if the employer makes deductions for cash register, inventory, or safe shortages; or if the employer makes deductions for absences for jury duty or attendance as a witness.

Importantly, even the possibility of salary docking -- absent actual deductions is enough to destroy the exemption from overtime pay in certain circumstances. In the landmark case of Auer v. Robbins, 519 U.S. 452 (1997), the U.S. Supreme Court interpreted the salary test to deny exempt status when employees are covered by a policy that permits disciplinary or other deductions in pay as a practical matter. That standard is met . . . if there is either an actual practice of making such deductions or an employment policy that creates a significant likelihood of such deductions.

Long John Silvers, Inc.s Illegal Policies and Practices

Beginning at least as early as December 1991, Long John Silvers maintained a written Restitution for Losses policy in its Administrative Policies and Procedures Manual which allowed Long John Silvers to recoup and/or obtain money from LJSs team members. Through this policy LJS has required its Restaurant General Managers and Assistant Restaurant Managers to pay for cash register shortages, deposit discrepancies, or other restaurant cash losses or shortages.

We believe Long John Silvers policy and practice of requiring its salaried restaurant managers to pay cash register or other shortages is clearly illegal under federal wage and hour laws. By being subject to this policy we believe that all Long John Silvers Restaurant General Managers and Assistant Restaurant Managers are legally non-exempt employees and are entitled to be paid overtime. In other words, if Long John Silvers policy or practice of requiring its salaried restaurant management staff to make restitution for cash shortages or other restaurant losses is found to be illegal, all persons who work(ed) as Restaurant General Managers and Assistant Restaurant General Managers are entitled to receive overtime pay even if they never actually paid a cash shortage through payroll deduction or out-of-pocket (in cash).

Class Action Complaint

On December 16, 2003, a nationwide class action was filed against Long John Silver's with the American Arbitration Association seeking back wages, liquidated (double) damages, and other damages because of Long John Silver's illegal "Restitution Policy" and "reimbursement" practices. Long John Silver's opposed the filing of the class action, arguing that a class action could not be filed in its arbitration program. On June 15, 2004, the Arbitrator held that Long John Silver's employees could file a class action against Long John Silver's in arbitration. To view a copy of Judge Hodge's award, please click on the Clause Construction Award link. Long John Silver's then filed a Motion to Vacate the Clause Construction Award in the South Carolina District Court on June 16, 2004. On March 3, 2005, the Plaintiffs filed an Amended Complaint with the American Arbitration Association. On September 15, 2005, the South Carolina District Court, denied Long John Silver's Motion to Vacate. To see a copy of Judge Floyd's Order, please click the Order Denying Motion to Vacate Clause Construction Award.

Additionally, on September 19, 2005 the Arbitrator, Judge Hodge,certified this case as an "opt-out"class action, which means, among other things, that any salaried Restaurant General Manager and/or Assistant Restaurant Manager who work(ed) for Long John Silvers, Inc. in any of its company-owned fast seafood restaurants throughout the United States from December 17, 1998 through August 22, 2004 is a member of the class, unless they choose to "opt-out" of the lawsuit. To see a copy of Judge Hodge's award, please click the Class Determination Award link. On October 25, 2005, Long John Silver's filed a Motion to Vacate the Class Determination Award in the South Carolina District Court. The South Carolina Courtagain denied Long John Silver's Motion. To view a copy of the Order that was entered by Judge Floyd on January 20, 2006, please click on the Order Denying Motion to Vacate Class Determination Award.

Statute of Limitations Tolled

On December 21, 2001, during the litigation of the Johnson v. Long John Silver's lawsuit filed in Federal Court, Long John Silvers Inc., entered into a Stipulation for Stay and Tolling Agreement which tolled the statute of limitations governing FLSA actions which means the statute of limitations stops running as to all present and/or former employees of Long John Silvers Inc., from the December 17, 2001, until thirty (30) days after either Long John Silvers Inc., or the Plaintiff gives notice in writing withdrawing their consent to continued tolling of the statute of limitations.

The significance of this tolling agreement is that any salaried Restaurant General Manager and Assistant Restaurant Manager who work(ed) for Long John Silvers, Inc. in any of its more than 700 company-owned fast seafood restaurants throughout the United States from December 17, 1998 through August 22, 2004 is potentially eligible to recover back wages for overtime pay, liquidated damages (or double damages), and other damages under the FLSA, depending upon their dates of employment with Long John Silvers, Inc.

Thus, this Stipulation for tolling the running of the statute of limitations could add several years of recovery-time to the back-wage claims of present or former employees of Long John Silvers Inc., depending upon their individual lengths of employment.

No Retaliation Permitted

It is illegal for any employer, including Long John Silvers, Inc., to retaliate against any manager or other employee, for filing suit or making a claim for overtime wages under the FLSA. Specifically, Section 15(a)(3) of the FLSA provides that . . . it shall be unlawful for any [employer] . . . to discharge or in any other manner discriminate against any employee because such employee has filed any complaint or instituted or caused to be instituted any proceeding under or related to this Act, or has testified or is about to testify in any such proceeding under or related to this Act. . .

Many courts allow employees who have been illegally retaliated or discriminated against because they made a claim of overtime wages against their employer to recover not only compensatory damages, but punitive damages as well against their employer.

If you have information about alleged or suspected retaliation or threats against any employee who has joined, or is eligible to join, this lawsuit by Long John Silvers, Inc., please contact us and let us know about it.

Stewart, Estes & Donnell

Stewart , Estes & Donnell has successfully represented employees in many lawsuits against employers who did not pay their employees for all hours worked where the employers misclassified their salaried employees as exempt from overtime pay, and have recovered tens of millions of dollars on behalf of such employees.

Stewart, Estes & Donnell Contact Information

If you work, or worked as a Restaurant General Manager or Assistant Restaurant General Manager for Long John Silvers, Inc., and are interested in learning more about your legal rights to overtime pay, please call us toll-free at 1-800-229-6538. Please ask for Pam Pardee or Joyce Cope. You may also e-mail us atpardee@sedlaw.comor at cope@sedlaw.com. All personal information will be held strictly confidential.