After a three-year investigation, the owner of the Crepevine restaurants, with locations in Oakland and Berkeley, was recently cited by the U.S. Department of Labor for violating federal overtime and child labor laws.
The owners, Suleiman Fakhouri & Sons, based in Burlingame, must pay back wages, damages and penalties to the tune of $552,000, according to a Labor department announcement released Tuesday.
The department investigation found that five of Crepevine’s nine restaurants underpaid workers who put in overtime hours and kept teens as young as 14 on the job beyond the legal requirements for minor employees.
In an administrative settlement, Fakhouri & Sons agreed to pay $234,636 in back wages to 114 underpaid workers, said Michael Petersen, a department spokesperson.
Crepevine also paid an equal amount in what’s called liquidated damages, or costs incurred by employees while they weren’t getting paid legally, such as for rent or child care, and $82,706 in civil money penalties.
In addition to Berkeley and Oakland, the violations occurred at Crepevine restaurants in Burlingame, Palo Alto and San Jose. Crepevine also has locations in Mountain View, San Francisco, San Rafael and Santa Rosa.
The labor department’s Crepevine investigation started in 2019, and was completed in December 2022, Peterson said. He wouldn’t comment on what triggered the close look at Crepevine, citing department policy, but said investigations are usually the result of employee or customer complaints. Sometimes, the department focuses on a specific industry, he said.
“I don’t have any specifics about violations at the two locations in Berkeley and Oakland, “ Peterson said. “Restaurants have been a focus area continuously, because it’s a workplace with a lot of vulnerable workers.”
“Employers such as Crepevine who employ workers at more than one location must combine the total hours worked an all locations to pay workers accurately to avoid overtime violations and, in this case, costly consequences,” said Department of Labor Wage and Hour Division District Director Susana Blanco in the press release.
“The onus is on employers to ensure their employees are paid fully and that workers receive all of the protections they are due.”
Specific Crepevine violations, according to the department, included:
- Failing to combine hours employees worked at more than one location.
- Paying overtime hours worked in cash at straight-time rates, when time and one-half is required.
- Failing to keep records of cash payments for overtime in its payroll records.
- Allowing 14- and 15-year-old employees to work past 7 p.m., more than 3 hours on school nights and more than 18 hours on school weeks.
- Not keeping records for several employees and not registering their hours worked and wages due.
Berkeleyside reached out to Crepevine at the Burlingame location, listed as the corporate headquarters, and couldn’t reach owners or managers. Staff answering the phone said to try back later, as the owners periodically visit the restaurants.
An employee at the Berkeley Crepevine, who was clearly nervous and didn’t want to be identified, said “things had been really crazy” at the restaurant in recent months, with management changes and a tightening down on break and employee meal practices.
The news about Crepevine comes at a time of heightened scrutiny of child labor violations, triggered in part by a New York Times investigation earlier this year into the dangerous conditions faced by migrant children crossing the U.S. border for work.
In May, a Popeyes fried chicken franchise in Oakland shuttered after it was accused by employees of child labor violations, as well as sexual harassment. The employees, who led a protest outside the fast food restaurant, filed complaints with the state. When asked about this situation, Peterson said he “can’t confirm or deny the existence of any ongoing investigations.”
State and federal labor departments may collaborate on investigations, depending on the situation, he said.
Also in the Bay Area, the operator of 14 Subway franchise restaurants was served an injunction earlier this year forbidding the shops from violating child labor laws, and retaliating against employees helping a Department of Labor worker practices investigation. None of the Subways are in Alameda County.
In other parts of the country, the labor department in May cited several McDonald’s restaurants in Kentucky for child labor violations. And last year, the same for Popeyes, Subway, Burger King, and Frodo’s Pizza restaurants in South Carolina..
“From the regional perspective, child labor has been in laser focus lately,” Peterson said. “The attention is good, we need a lot of people to be watching. The more people who know, the more we know it’s happening.”
Against this backdrop, several states recently have taken steps to loosen child labor laws, including Iowa, Minnesota, Missouri, Nebraska, Ohio, and South Dakota, and Arkansas. The effort, led primarily by Republican lawmakers, cites serious worker shortages as the reason for allowing more flexibility for younger employees.
Meanwhile, the Department of Labor encourages anyone with concerns or questions about workplace wage and hour issues to contact them. The department has a toll-free confidential phone line where people can make reports in more than 200 languages — 866-4US-WAGE (866-487-9243).It also has a search tool to see if you might be owed back wages from a previous settlement.
