Hope is on the horizon for Minnesota restaurants! On September 20, it was announced that the Minnesota Supreme Court will hear the appeal from the novel decision, Burt v. Rackner, Inc. d/b/a Bunny’s Bar & Grill (MN App. June 27, 2016). As I wrote about on August 4, 2016, the plaintiff, Todd Burt, was terminated by Bunny’s Bar and Grill for not sharing tips with other employees. Despite not losing tips/money, the Minnesota Court of Appeals held (for the first time in 40 years) that the termination of his employment for refusing to share his tips with other employees resulted in his lost employment, and thus, he had an actionable claim to recover future lost wages under the Minnesota Fair Labor Standards Act (MnFLSA). This may not sound like a big deal, but it is – here’s why.
The MnFLSA already provides remedies when an employee is wrongfully forced to share tips – the Minnesota Human Rights Commissioner may require the employer to pay the employee the lost wages. The problem is obvious, right? Here, the employee didn’t lose any wages – because he wouldn’t share – so he sued under this new theory that it was wrongful discharge in violation of the MnFLSA. This opens up an entirely different box of remedies – and litigation. Good for the employee. Bad for the employer. The question is, what remedies does the MnFLSA allow, as interpreted by the courts (this is called “common law”).
In the Court of Appeals opinion, the Court held, for the first time: “Where an employer requires, as a condition of employment, that an employee consent to working rules expressly prohibited by the MFLSA, the employee is authorized by the statute to sue for damages normally associated with a wrongful-discharge cause of action.” This decision was monumental, creating a new exception to Minnesota’s at-will employment.
Not surprisingly, and a great relief to many restaurants and employers, on July 27, 2016, Bunny’s Bar & Grill, petitioned the Minnesota Supreme Court to review (and overturn, obviously) the Court of Appeals decision. Here is the issue on appeal:
Whether the MFLSA, Minn. Stat. §§ 177.24 and 177.27, creates a claim for the retaliatory discharge of an employee who refused to share gratuities, abrogating the common law of at will employment without any expression of legislative intent to do so.”
That’s fancy lawyer speak for asking the Supreme Court to decide that the Court of Appeals decision improperly interprets the MnFLSA to create an action for wrongful discharge, when the law does not itself provide such an action. Bunny’s position is that the Minnesota legislature must change the law, not the courts, which are only tasked with interpreting the law. On August 17, the Minnesota Restaurant Association (MRA) asked the Minnesota Supreme Court to allow it to file a brief in support of Bunny’s Bar & Grill petition. On September 20, the Minnesota Supreme Court announced that it would take the extraordinary step and review the Court of Appeals decision, and also allowed the MRA to file an amicus curiae brief (a brief supporting why Bunny’s is right and the Court of Appeals was wrong) in support of Bunny’s.
Keep in mind that the decision, while applicable to tips sharing, will certainly be broadly interpreted (beyond tip sharing) and used for other wage situations. Accordingly, I would not be surprised to see more employer associations or large employers ask to file a “me too” amicus curiae brief. After that, it’s the hurry up and wait game – after briefing and oral arguments, I wouldn’t expect to see a decision until Spring 2017, so we’ll just have to wait.