In the most recent installment of the Connecticut Labor Department’s crackdown on New Haven food establishments, a “stop work” order was posted Monday afternoon on the door of Chap’s Grille on Chapel St.
The Department of Labor (DOL) specifically cited the store for allegedly paying its workers in cash without paying workmen’s compensation insurance, which provides benefits for employees injured on the job. Chap’s reportedly also classified workers falsely as independent contractors, thus depriving them of employee benefits.
However, according to the director of the DOL’s Wage and Workplace Standards Division Gary Pechie, the stop work order only lasted one full day. Chap’s reopened on Wednesday after instituting a workers’ compensation policy and placing all employees on payroll — eliminating payments of cash “off the books”.
“They have done everything that an upstanding business should do,” Pechie said. “They can reopen now that they have complied with what we asked them to do.”
Pechie added that Chap’s could still incur a small fine, as a $300 fine is assessed for each day that an employee works while not on proper payrolls after a “stop work” order is issued.
Chap’s owner Alex Elsankary said the DOL provided his restaurant time to get workers’ compensation insurance, which establishments must provide now by state law.
While Elsankary said he did not know about the issue until the labor department alerted the restaurant, he said he believes that DOL representatives are dropping in on businesses around the Elm City.
“I believe it has to do with the Affordable Care Act, and they have to make sure everyone’s covered,” Elsankary said.
According to the New Haven Independent, the department did not act on a tip from an employee, and it was, as Elsankary suggests, dropping in on Elm City businesses in order to ensure fair labor practices.
Unidad Latina en Acción organizer Megan Fountain ’07 said she believes that this stop work order falls within the DOL’s efforts to more strictly enforce the minimum wage and overtime laws, as her organization has heard from the community that these laws are “being broken on a regular basis.” ULA is a local community organization that informs workers of their rights and negotiates on behalf of workers to resolve wage-related disputes with employers.
During her experience as a volunteer with ULA for the past seven years, Fountain said that in general the state government has not prevented the problem of wage theft, and owners don’t take the government very seriously.
“[Employers] see these fines as a slap on the wrist,” Fountain said. “Now government is responding and sending a message that this is serious — that if you break the law, you’ll be accountable.”
Fountain added that, under state law, each establishment must hang a poster featuring information on worker protection laws, including the minimum wage and mandatory reporting of sexual harassment. She said he does not believe most businesses in New Haven actually do so.
Chap’s run-in with the DOL follows wage-related incidents at other area businesses. Last month, Chung Cho, the owner of popular 24-hour convenience store Gourmet Heaven was arrested on numerous felony counts of failure to pay wages, failure to pay overtime and defrauding immigrants. Last week, J & B Deli was served a “stop work” order for failing to pay its workers the minimum wage and overtime compensation.
Chap’s is not managed by the University Properties office.
Last Wednesday, the Connecticut State Legislature approved a law that will raise the minimum wage to $10.10 from its current rate of $8.70 over the next three years.