Watermill Caterers in Smithtown sued over alleged withholding of tips

Claiming management illegally withheld tips since at least 2016, two food service workers at the Watermill catering hall in Smithtown have sued the company and its officers, demanding payment and unspecified damages.

The lawsuit, filed in Suffolk County Supreme Court and amended Thursday, was filed on behalf of Cigdem Metin and Sevil Nixon, who worked at benefits and other events at Watermill Caterers on Route 347 in 2017.

The suit names as defendants William Lacal, Vincenzo Pugliese and Silvana Scotto-Zangri. All are listed as company principals on the liquor license for the Watermill, which also does business as Scotto Smithtown Hotel, according to the suit.

A lawyer for the company and its principals did not respond to a request for comment. A receptionist who answered the phone at the Watermill said nobody was available to comment. The defendants have until April 14 to respond to the suit.

An early version of the complaint, filed in January, sought class action status for more than 40 workers; an amended complaint, filed Thursday, did not make that request. The reason for the change was unclear. 

Metin and Nixon could not be reached, and it was unclear if they still worked for the Watermill. Lawyers from the Carle Place-based Leeds Brown firm representing them did not respond to requests for comment. 

It was unclear if Metin and Nixon had filed claims with the state Department of Labor, which enforces rules forbidding employers from appropriating tips. The department’s press office did not respond to requests for comment.

Dispute over 'mandatory charge' 

The Watermill, part of the Scotto family’s portfolio of upscale Long Island eateries and catering halls, regularly hosts weddings and galas and was for years a destination for local GOP politicians, including former Smithtown Supervisor Patrick Vecchio.

In 2019, Anthony Scotto, who is not named in the lawsuit, proposed a $28.2 million, 130-room hotel at the site. Municipal environmental review of the proposal is underway.

The amended suit alleges Watermill management violated New York State labor law with a "mandatory charge" that appeared on its menus and invoices. 

Based on a percentage of food and beverage bills, the charge would have looked like a gratuity for waitstaff to "reasonable patrons," according to the suit. 

But the suit alleges that management kept the money "for their own benefit," evaded recordkeeping requirements for such charges and "represented or allowed" patrons to believe the mandatory charge was a tip. 

Employees of Scotto family businesses including Watermill filed a class action suit against the companies in 2010 in State Supreme Court in Nassau County, alleging that management illegally retained a mandatory 20% service charge on catered events and failed to pay overtime wages to employees who worked more than 40 hours per week. 

The suit settled in 2013 with a settlement paid to waitstaff, according to court records. But the records, which Newsday reviewed Friday in the court clerk’s office, didn’t include a settlement amount or an admission of guilt by management.  

Organizations that have advertised events at the Watermill include the Suffolk Sports Hall of Fame, Smithtown Central School District and World of Pink Foundation, a breast cancer charity. Hall of Fame representatives could not be reached. A spokeswoman for Smithtown schools, whose Junior Gala is scheduled to be held at the Watermill in April, declined to comment. 

World of Pink president Christine Guarino, who hosted fashion shows at the Watermill for years before moving to a larger space, said she had never paid administration fees and that the allegations were hard for her to believe.

“Nobody that I worked with ever seemed like they were unhappy as staff members or slighted,” she said. The owners and managers she knew were “above-and-beyond generous,” even discounting fees so she could give more generous tips to the waitstaff, she said.

“They don’t deserve this," Guarino said.