Chichinadze v. BG Bar Inc.

Background

Ketevan (Keti) Chichinadze brought claims under the Fair Labor Standards Act (FLSA), the New York Labor Law (NYLL), and the New York City Human Rights Law against BG Bar Inc., doing business as Mehanata and Bulgarian Bar; its owner, Alexander Dimitrov; and its manager, Tania Dimcheva. Chichinadze moved for partial summary judgment—a ruling that no trial is needed on issues where there is no genuine dispute of material fact—against BG Bar and Dimitrov concerning liability and damages for certain wage violations. She also asked the court to strike parts of the defendants’ summary-judgment submissions.

Chichinadze worked as a bartender at BG Bar from approximately September 2014 through July 2018. The records produced by the defendants showed at least 252 hours worked in 2014, 432 hours in 2015, 970 hours in 2016, 1,314 hours in 2017, and 662 hours in 2018. Dimitrov testified that she received an hourly “house pay” of $3 to $3.50 plus tips. The parties agreed that the wage statements did not accurately show her hours or hourly pay, and Chichinadze stated that she did not receive the wage notices required by the NYLL.

Motion to Strike

The court denied the motion to strike. It declined to strike the defendants’ submissions solely because they were filed late, finding that the delay was relatively brief and that Chichinadze had not shown prejudice.

The court nevertheless refused to treat Dimitrov’s declaration and related factual statements as creating a genuine factual dispute where they contradicted his deposition testimony. In his deposition, Dimitrov repeatedly described Chichinadze’s pay as $3 or $3.50 per hour plus tips. His later declaration asserted that she also received weekly, unrecorded cash payments, but the court found that assertion unsupported. The court therefore considered the defendants’ submissions only to the extent they were not contradicted by Dimitrov’s deposition testimony.

Minimum-Wage Liability

The court held that BG Bar and Dimitrov were Chichinadze’s employers under the FLSA and NYLL. Because the defendants acknowledged that their records of hours and wages were incomplete or inaccurate, Chichinadze needed to provide sufficient evidence from which the violations and damages could reasonably be inferred. The court found that Dimitrov’s deposition testimony that she was paid $3 to $3.50 per hour satisfied that initial burden.

Under the NYLL, the defendants then had to prove that they paid the required wages. The court found that they did not meet that burden. It also found that they had not shown that they were entitled to a tip credit, which allows an employer to count some tips toward the minimum wage. The defendants did not prove that they gave the required notice of the tip credit or obtained and kept Chichinadze’s written acknowledgment. Posters describing wage-and-hour laws were insufficient to establish compliance with the federal or New York notice requirements.

The court used the $3 hourly rate for its calculation and relied on the minimum hours reflected in the defendants’ records. Using the higher New York minimum wage, it calculated $26,696 in back wages: $1,260 for 2014, $2,484 for 2015, $5,820 for 2016, $10,512 for 2017, and $6,620 for 2018.

Liquidated Damages

The court awarded liquidated damages under the NYLL equal to 100 percent of the back wages, or $26,696. Under the applicable law, the defendants could avoid liquidated damages only by proving that they had a good-faith, objectively reasonable basis for believing their pay practices complied with the law. The court found that they did not meet that burden. Dimitrov’s reliance on an accountant and on ADP, the payroll company, did not establish the required active effort to determine and follow wage-law requirements.

Wage Notices and Wage Statements

The court also granted summary judgment on Chichinadze’s claims that the defendants failed to provide required wage notices and accurate wage statements. It found that the defendants had not shown that they provided the required individualized notices and had effectively conceded that the wage statements did not accurately report her hours or wages.

The court found Chichinadze entitled to $5,000 in statutory damages for the wage-notice violations and an additional $5,000 for the wage-statement violations, each amount being the statutory maximum identified in the opinion.

Disposition

Judge Katherine Polk Failla granted Chichinadze’s motion for partial summary judgment and denied her motion to strike. The court found her entitled to $26,696 in NYLL back wages, $26,696 in NYLL liquidated damages, $5,000 for the NYLL wage-notice violation, and $5,000 for the NYLL wage-statement violation. The opinion states that a material dispute remained over whether Tania Dimcheva was Chichinadze’s employer for purposes of the alleged FLSA and NYLL violations. The court directed the parties to submit a joint status letter about next steps.