Settlement Secures $85,000 in Back Wages, Interest for Cheated Chinatown Restaurant Workers

First Legal Action to Enforce Voter-Passed 2003 Minimum Wage Ordinance Highlights Successful Collaboration by Community, OLSE, City Attorney’s Office

SAN FRANCISCO (Sept. 14, 2006) — City Attorney Dennis Herrera today announced a settlement in litigation filed just over a year ago against two Chinatown restaurateurs for failing to adequately compensate employees of the now-defunct King Tin Restaurant. Under terms of the agreement to be considered by the San Francisco Board of Supervisors’ Rules Committee this morning, defendants Kam Kong Tang and Kai Yuen Ng will pay back wages for violations of the local minimum wage ordinance and overtime laws to seven employees totaling $85,000. If approved by the full board, the settlement would successfully conclude the City’s first legal action to enforce provisions of the San Francisco Minimum Wage Ordinance, which voters passed in November 2003.

The workers to receive compensation and interest from their former employers are all monolingual Cantonese speakers who served at the restaurant (in two cases as long as 20 years) as cooks, waiters, dishwashers and janitors. According to an investigation into King Tin Restaurant’s employment practices by the City’s Office of Labor Standards Enforcement, employees were frequently required to work up to 100 hours per week — in some cases logging shifts of as much as 17 hours per day — and were paid monthly lump sum amounts that fell far short of the City’s hourly minimum wage. (During the period of King Tin’s wage violations in 2004, San Francisco’s minimum wage was $8.50 per hour; it is currently $8.82 per hour.)

“This settlement sends a clear message that there’s no profit motive in flouting our Minimum Wage Ordinance in San Francisco,” said Herrera. “”Minimum wage cheats don’t merely deprive working men and women of their lawful right to earn a living wage, they unfairly compete with the vast majority of businesses that abide by the law. I want to acknowledge the great work of the Office of Labor Standards Enforcement, and also express our appreciation to the Chinese Progressive Association for its leadership in the community to help move our case forward.”

“The City will protect the rights of all workers to the minimum wage, and this settlement demonstrates that OLSE and the City Attorney can work closely and effectively with the community to make sure the law is aggressively enforced,” said Donna Levitt, The City’s Labor Standards Enforcement Officer. “Owners do not escape responsibility to pay employees’ wages by closing their business and filing for bankruptcy protection.”

Doing business for more than two decades on Washington Street in Chinatown, King Tin Restaurant abruptly closed in July 2004 shortly after some of its employees began complaining to the California Department of Industrial Relations about not being paid the state or local minimum wage. Two months later, the corporation operating the restaurant filed for bankruptcy. Although the restaurant made a partial payment to employees for back wages before going out of business, a subsequent audit conducted by OLSE estimated that approximately $68,000 in back wages remained unpaid at the time King Tin filed for bankruptcy.

On June 9, 2005, the State Labor Commission filed suit against Tang and Ng, as part owners of the restaurant who were also in charge of its day-to-day operations, for violations of state wage and hour laws. The City filed a companion suit against the same former owners on August 3, 2005 seeking relief for the King Tin employees under the City’s minimum wage ordinance. The City’s investigation was greatly assisted by the Chinese Progressive Association, a grassroots membership-based organization that works to improve the living and working conditions for low-income immigrants. The organization was instrumental in assisting monolingual employees in bringing wage claims forward to State and City investigators.

“After almost 2 years, we are happy to finally see justice for workers prevail today,” said Pak Wai Tam, a former King Tin Restaurant worker. “The King Tin Restaurant filed for bankruptcy to avoid paying us the minimum wage that we deserve — not for any other reason; employers need to know that workers will stand up against exploitation.”

“This is a significant victory for all workers in the Chinese immigrant working class community. CPA appreciates the diligence of the Office of Labor Standards Enforcement (OLSE) and the San Francisco City Attorney’s Office representing the interests of the Kin Tin Restaurant workers who CPA supported in bringing forward their wage claim,” said Alex T. Tom, Campaign Coordinator, Chinese Progressive Association. “We look forward to future collaboration with city government agencies to ensure justice for all workers.”

The Minimum Wage Ordinance, passed by the voters in November 2003, calls for annual rate adjustments based on the previous year’s Consumer Price Index for urban wage earners in the San Francisco-Oakland-San Jose metropolitan area. For more information about San Francisco’s Minimum Wage Ordinance, the public may call the City’s multi-lingual hotline at (415) 554-6292. The case is City and County of San Francisco vs. Kam Kong Tang et al, San Francisco Superior Court No. 05-443685.

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