As the weather cools down and the holidays are upon
us, guests come bearing two things: coats and packages. That means, coat-check
season is here. Inevitably, two questions follow: (1) whether coat-check personnel
should be on pay-roll; and, (2) whether coat-check personnel should be paid
(1) Whether coat-check personnel should be on pay-roll.
This is really a rhetorical question. All employees should be properly classified
as “employees”. While some operators may feel the urge to save
payroll costs and treat these part-time or seasonal employees as “independent
contractors,” thus avoiding payroll taxes and the other “costs” of
properly classifying coat-check personnel as employees—fight the urge.
For numerous legal reasons, the Internal Revenue Service, the Department of
Labor’s Wage and Hour and Unemployment Divisions, and other interested
governmental agencies do not consider those individuals who perform the job
functions of coat-check personnel as independent contractors.
There are certain third-party companies with whom a restaurant may contract
to provide services including coat-check personnel. However, there is a danger
to this type of arrangement if the third-party does not take the care to meet
all of the legal requirements with its employees working within your restaurant.
Courts and agencies often look to the restaurant operator for liability and
damages through a theory of joint-employer status. Recent history has demonstrated
that New York’s Attorney General has paid attention to this issue with
respect to bathroom attendants. In essence, a joint-employer relationship often
comes down to “control”. Courts will look at factors such as, where
the work is performed and whose equipment is used; the degree to which the
contractor or its agents supervised the workers’ work; whether the workers
worked exclusively or predominantly for the contractor; and the extent to which
the workers performed a discrete line job that was integral to the contractor’s
process of production.
A coat-check employee even with seasonal employment and limited hours can make
the same claims against an employer for unpaid wages, overtime claims, meal
breaks, harassment or other employment claims. However, another serious risk
for a restaurant operator when treating coat-check personnel as independent
contractors may result in losing the protection of the workers’ compensation
system. Quite simply, when a worker is not properly classified and treated
as an “employee,” an employer loses the protection of the workers’ compensation
laws. As a result, a coat-check worker who becomes injured on the job may be
able to sue the restaurant and its corporate owners for all damages – including
costly “pain and suffering” damages--if that worker was improperly
classified as an independent contractor. Without the protection of the workers’ compensation
defense, this could be a very costly mistake for a restaurant.
(2) Whether coat-check personnel be paid a tipped rate.
Yes. Coat-check personnel can be paid the non-food service worker tipped rate
of pay under New York State law, as long as their tips when added to the
tipped rate equal or exceed the minimum wage. Therefore, as with any front-of-the
house tipped employees, coat-check employees must be required to report all
Coat-check employees should receive and sign-off on any employee handbooks,
tip policies, and be treated like all other restaurant employees. While coat-check
personnel will add to a restaurant’s payroll for the season—the
perceived short “gain” for not complying with the labor laws will
invariably lead to very costly penalties and damages.
Carolyn D. Richmond practices labor and employment law with the national law firm of Seyfarth Shaw, LLP.
Ms. Richmond can be reached at
This website designed by Business Edge. Click here for Restaurant Website design information