
The Minnesota Supreme Court’s ruling was issued this week in Burt v. Rackner, Inc. d/b/a/ Bunny’s Bar
& Grill. The plaintiff, Todd Burt, alleged that he was told by his
restaurant employer that “to give more of his tips to the bussers, and that
there would be consequences if that did not happen.” After refusing to follow
the directive, Burt was terminated. Burt sued, claiming that his termination
violated the tip-sharing provision of the Minnesota wage and hour
law. More specifically, Minnesota law prohibits an employer from requiring
an employee “to contribute or share a gratuity received by the employee” or to
“contribute any or all of the gratuity to a fund or pool.”
Before Burt’s case made its way to the Minnesota Supreme Court, a state
district court judge dismissed the case on grounds that there was no private right
of action under the state law for wrongful discharge for refusing to share
tips. The Minnesota Court of Appeals reversed, holding that the state law
“unambiguously” provides an employee the right to bring such a civil action and
seek appropriate damages. The Minnesota Supreme Court granted the employer’s
petition for review and affirmed the Minnesota Court of Appeals.

The employer also argued that Burt could not bring suit, because the
Minnesota wage and hour law allegedly does “not expressly provide a cause of
action for wrongful discharge arising out of an employee’s refusal to share
tips.” The Court rejected this argument, finding that the statute’s express
prohibition on forced tip sharing coupled with other statutory language
providing for a broad right action for any violation of the state wage and hour
law, “expressly authorizes an employee to sue for wrongful discharge arising
out of a refusal to share tips” and allows the recovery of “any damages or appropriate relief, including
back pay.”
The Rackner ruling and the
earlier Surly ruling should prompt
employers with tipped employees to review their tipping practices to ensure
legal compliance and avoid expensive legal claims.
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