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Tattletail Sued

An Atlanta strip club has been hit with another putative class suit alleging it stole waitresses' tips, paid servers an illegal subminimum wage and evaded recordkeeping mandates.

Former waitress Mia Glessing's complaint alleges Tattle Tail Inc., doing business as the Tattletail Lounge, maintained an unlawful tip pool that shared servers' earnings with managers and charged tipped employees a fee to convert gratuities paid with credit cards into cash, suppressing their wages below the federal minimum wage.

Although tipped servers can be paid less than minimum wage as long as gratuities make up the difference, the theft of their earnings by Tattletail's management pushed their straight hourly pay to $2.13, the complaint said.

The underpayment and deliberate underreporting of employee earnings violate the Fair Labor Standards Act, according to Glessing.

At "all times relevant to this action, defendants willfully violated the FLSA knowing that their wage scheme, compensation policies, kickback schemes and required tip-pool contributions were illegal," the complaint said.

Glessing's complaint also names club owner Denis Kaufman and general manager Richard R. Schronce.

Jonah Flynn, Glessing's attorney, said the former waitress and a collective group of servers may be entitled to recover their tip pool contributions and double damages.

"The damages could be significant," Flynn said in an email to Law360 on Wednesday.

Flynn also represents a group of Tattletail dancers that filed a suit in Georgia federal court last September against the club over alleged wage theft.

Between 2014 and 2015, Tattletail and its owner have been sued three times by dancers and servers in the U.S. District Court for the Northern District of Georgia over purported wage violations, cases that have since been settled, according to court records.

Glessing's Friday complaint, made available Wednesday, said before July 2021, the club made servers pay between 15% and 30% of their earnings to a tip pool divided among managers and nontipped employees. The pool was invalid since employers cannot distribute those earnings to nontipped workers or retain tips, according to the complaint.

The suit further claimed servers tipped "T-bucks," which are tips paid from credit cards, had to pay the club a 10% fee to transfer the tip into cash, which is an unlawful deduction and an illegal kickback under federal labor law.

The wage schemes, including failing to pay while servers cashed out after their shifts, forced the workers' hourly wages far below the $7.25 federal minimum wage, Glessing said.

Tattletail also failed to keep, or intentionally filed, inaccurate records of the conversion fees, time sheets and tips, according to the complaint.

Tattletail "knew, or showed reckless disregard for the fact that their compensation policies violated the FLSA," Glessing said.