Minnesota Supreme Court delivers another victory for employees
In Burt v. Rackner, Inc., the Minnesota Supreme Court affirmed the Minnesota Court of Appeals and ruled that employers cannot fire employees who refuse to share the tips they earned. The employer told the plaintiff, who was a bartender, that he must share more of his tips with the employer’s bussers or there "would be consequences. . . .” When the plaintiff declined to share even more of his tips to supplement the modest wages the employer paid its bussers, the employer terminated the plaintiff.
The employer did not deny that it fired the plaintiff for not sharing tips he earned, but the employer argued that the law supposedly does not bar an employer from taking such action. The plaintiff sued the employer under the Minnesota Fair Labor Standards Act, Minn. Stat. §§ 177.21, et seq. The trial court dismissed the case, but the Minnesota Court of Appeals reversed the dismissal, and the Minnesota Supreme Court upheld the reversal. In explaining its decision, the Minnesota Supreme Court reasoned that “threatening to terminate an employee for failing to do something imposes a 'requirement' on the employee and, at the very least, constitutes coercion by the employer.”
Given this landmark case, employees should also be able to challenge successfully their discharge under similar circumstances based on Minnesota’s whistleblower law, Minn. Stat. §§ 181.93, et seq. That law prohibits an employer from firing an employee for, among other reasons, reporting or opposing illegal conduct by the employer. An employee who objects to a demand by an employer that the employee share the tips he or she has earned should now certainly be considered to be engaging in protected activity under Minnesota’s whistleblower law. In that context, firing an employee would be illegal retaliation against a whistleblower. Burt also may help with the prosecution of class actions in analogous wage theft cases.