Friday, February 3, 2023

Feds fine two Carolina Beach restaurant bars for labor violations, 30 employees owed back pay

The former owner of The Dive and current owner of Hurricane Alley failed to maintain payroll records, improperly classified employees as independent contractors to avoid paying overtime, and didn't pay tipped employees an hourly wage, according to a U.S. Department of Labor investigation.

Hurricane Alley and The Dive in Carolina Beach violated the Fair Labor Standards Act, a recent U.S. Department of Labor investigation found. (Port City Daily photo/Courtesy Google Maps)
Hurricane Alley and The Dive in Carolina Beach violated the Fair Labor Standards Act, a recent U.S. Department of Labor investigation found. (Port City Daily photo/Courtesy Google Maps)

CAROLINA BEACH — The U.S. Department of Labor has ordered the former owner of The Dive and current owner of Hurricane Alley in Carolina Beach to pay back $40,555 in wages to 30 employees.

Tipped employees weren’t paid any wages and will be reimbursed according to the federal minimum wage at $7.25, a Department of Labor’s investigation revealed.

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David Cole operated both Hurricane Alley LLC and Diver Down LLC. Cole sold The Dive to Laura and Ryan O’Rourke a year ago, according to Laura O’Rourke, and continues to operate Hurricane Alley. O’Rouke said the DOL violations do not stem from her recent ownership of The Dive.

The U.S. Department of Labor (DOL) announced Tuesday its labor wage and hour division investigation found multiple violations of the Fair Labor Standards Act between the two restaurant and bars: minimum wage, overtime, and recordkeeping requirements.

Cole’s employees were improperly classified as independent contractors, according to the DOL investigation. This created overtime violations when employees who worked over 40 hours a week were paid in straight time, rather than the required time-and-a-half.

Also, investigators found Cole failed to maintain federally-required payroll records.

Hurricane Alley and The Dive are obligated to pay back wages totaling $40,555.

The two restaurant bars are also enjoined from committing future violations under the Fair Labor Standards Act.

“Employers are obligated to pay employees the wages they have legally earned. Our enforcement ensures employers that violate the law do not gain an unfair competitive advantage over those that comply,” Wage and Hour Division district director Richard Blaylock said in the DOL release.

The DOL encourages employers to reach out to their local Wage and Hour Division office for more information about how to comply with regulations at 919-790-2741.


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