Bill would ban caterers' wait staff suits for tips

The New York State Senate passed a bill Tuesday that would grant immunity to catering companies that face lawsuits over not sharing service charges with their employees.

The state's highest court ruled in 2008 that such charges must be paid to the workers and not kept by the companies if customers had a reasonable expectation that it was a gratuity. Since the ruling, former workers have sued catering halls and companies over service charges going back to 2004.

According to the bill's sponsor, Sen. Jack Martins (R-Mineola), state Labor Department guidelines before the court ruling did not treat service charges as gratuities. "Retroactive liability for catering facilities .?.?. for activities and interpretations that were consistent with labor department regulations would be unfair," Martins said. "These catering facilities were doing nothing other than following the law as it existed at the time."

Sen. Jose Peralta (D-Jackson Heights) criticized the bill as protecting "powerful interests" at the expense of working people. "If enacted, this bill would shield employers who kept money from their workers through deception and outright lies," Peralta said.

Martins said his bill would grant immunity to catering companies for their service charge practices before the law goes into effect, but that from now on, companies that do not share service charges with staff must tell customers that in writing.

The bill has been introduced in the Assembly by Assemb. Phillip Goldfeder (D-Far Rockaway), but its future is uncertain. In 2007, then-Attorney General Andrew M. Cuomo filed a friend-of-the-court brief in the landmark case Samiento v. World Yacht, arguing that the company had engaged in deceptive practices in violation of state labor laws.

Gov. Cuomo has not taken a position on whether catering companies should be granted immunity. When asked about it on Monday, Cuomo said, "I would have to look at it. It depends on the facts and the circumstances .?.?. was the law unclear and that's why [catering companies] didn't know? That's why I'd need to look at the facts."