House Bill Seeks to Bar Wage Violators from Obtaining Relief under the Restaurant Revitalization Fund

The U.S. House of Representatives has voted to pass H.R. 3807, which, if approved by the Senate and President Biden, will inject $42 million into the Restaurant Revitalization Fund designed to provide financial assistance to restaurants impacted by the COVID-19 pandemic.  The bill would also create a new, separate relief fund of $13 billion targeted toward other small businesses similarly impacted.

Representative Rashida Tlaib of Michigan is now pushing for amendment to the bill that would bar restaurants or other businesses with recorded wage violations from recovering any relief under the funds.  Notably, before being elected to Congress, Tlaib represented workers who were denied wages as an attorney at the Maurice and Jane Sugar Law Center for Economic and Social Justice.  As Tlaib succinctly explained: “Restaurant workers risked their lives and are a critical part of the restaurant industry.  These dollars should go to businesses who do right by their workers, not those who exploit and steal from them.”

While the amendment awaits review by the Senate—particularly by those to the right of aisle—it has already received scrutiny from the left.  Saru Jayaraman of One Fair Wage commended the amendment, but said it does not go far enough.  Specifically, Jayaraman feels the bill should also bar recovery by restaurants who pay employees at the tip credit minimum wage, even though this practice is lawful in most states:  “It shouldn’t be that you get the money if you don’t commit wage theft, it should be that you get the money if you pay a full minimum wage.”

It is no secret that restaurants are some of the greatest culprits when it comes to wage theft.  While it could certainly go farther to protect restaurant workers, Tlaib’s amendment should be lauded for recognizing this reality and taking meaningful steps to ensure that relief funds go to those restaurants that have continued to pay employees their full wages, rather than those that have survived the pandemic by lining their pockets with their employees’ hard earned pay.

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About Alex Hartzband

Alex Hartzband's practice is focused on employment litigation. Alex is a senior associate in the firm's New York office.

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