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Chen v. C & R Rock Inc.

United States District Court, D. New Hampshire

March 22, 2016

Yin Gui Chen
C & R Rock Inc., et al. Opinion No. 2016 DNH 060


          ANDREA K. JOHNSTONE, Magistrate Judge.

         The plaintiff Ying Gui Chen, proceeding pro se, has brought suit against C&R Rock, Inc. ("C&R Rock"), Johnny Zeng, Mark Zeng, and Jin Huang (collectively "defendants") alleging they violated the Fair Labor Standards Act of 1938 ("FLSA"), 29 U.S.C. § 201 et seq., and New Hampshire Revised Statutes Annotated ("RSA") §§ 275, 279, when they failed to compensate him for all hours worked and overtime wages.

         The court held a one-day bench trial on February 24, 2016. Chen testified on his own behalf.[1] Huang testified for the defendants. After considering the trial testimony and the record evidence, the court concludes that C&R Rock and Huang are liable to Chen for violations of the FLSA and RSA in the amount of $16, 930.76. Pursuant to Federal Rule of Civil Procedure 52(a), the court's findings of fact and rulings of law are set forth below.

         Findings of Facts

         C&R Rock, a corporation based in New Hampshire, does business as a restaurant under the name Peking Tokyo of Lebanon ("Restaurant"). Tr. 50:5-18; Defs.' Ex. B, doc. no. 88. On average, the Restaurant's sales total between $70, 000 and $80, 000 each month. Tr. 93:4-10.

         Jin Huang is the sole owner of C&R Rock. Id .; Defs.' Ex. A. Johnny Zeng, Huang's husband, works for C&R Rock as an assistant manager. Tr. 49:6-9, 60:9-15. Mark Zeng, Johnny Zeng's uncle, has never been an owner, director, or employee of C&R Rock. Tr. 55:17-56:12, 56:20-21.

         Huang testified that her responsibilities at the Restaurant include creating the employees' schedules, managing orders, and preparing payroll. Tr. 60:16-24. Huang testified that she understood "labor law" and employees would speak with her if they "had any issues." Tr. 61:5-9, 91:19-23. Huang testified that she and her husband, Johnny Zeng, preform "prep work" for the Restaurant at night after it has closed or before it opens in the morning. Tr. 97:15-24.

         The plaintiff, Ying Gui Chen, began working at the Restaurant on September 28, 2009. Tr. 69:2-8; Defs.' Ex. D. On October 2, 2009, Chen and Huang signed an employment agreement. Defs.' Ex. H. The agreement stated that Chen would be paid $8.00 an hour as a cook for 20 to 40 hours of work per week. Id . The agreement also stated that Chen, as an employee, had "the duty to report any wage statement errors to the Employer within two (2) weeks of the affected wage statement (including wrong regular working hour, overtime, overtime pay and pay rate), otherwise the right to dispute is waived." Id.[2]

         Although Chen's employment agreement stated that he would be paid $8.00 an hour, he was paid $7.50 from September 28, 2009, to November 29, 2009. Defs.' Ex. E, at 1-5. Huang explained that Chen's pay of $7.50 was "the training rate." Tr. 75:2-14. Beginning on November 30, Chen pay was increased to $8.00 an hour. Defs.' Ex. I, at 5.

         Chen stopped working at the Restaurant in June 2010. Tr. 68:18-2; Defs.' Ex. D. Soon after, Chen moved to St. Louis, Missouri to work at another restaurant. Tr. 23:6-24:18. Chen returned to work at the defendants' Restaurant on January 23, 2012. Tr. 76:17-24. There is no evidence of an employment agreement during this second period of employment. Chen worked at the Restaurant until the first week of May 2013. Tr. 9:10-13, 87:7-10.

         At trial, Chen testified that he worked 67 hours each week while employed by the Restaurant. Tr. 10:7-9, 19:11. The chart below summarizes the hours Chen stated he worked at the Restaurant each week:

         Monday Tuesday Wednesday Thursday Friday Saturday Sunday 10:30 10:30 10:30 10:30 10:30 11:30 a.m. a.m. a.m. a.m. a.m. a.m. - Off - - - - - 9:30 9:30 9:30 10:30 10:30 9:30 p.m. p.m. p.m. p.m. p.m. p.m.

         Tr. 9:20-24, 20:15-20.

         The alleged hours worked by Chen mirror the hours the restaurant was open; the only difference being that Chen testified that he started working 30 minutes before the restaurant opened in order to complete food preparation.[3] Tr. 33:8-12. Chen never testified that he performed any work after the Restaurant was closed for the night.

         During trial, the defendants presented pay stubs (Defendants' Exhibits E and G) and work schedules (Defendants' Exhibits D and F) to refute Chen's claim of hours worked. The pay stubs note how many hours Chen worked each week and match the hours Chen was scheduled to work in a particular week. Defs.' Ex. D, E, F, and G. Most weeks, the Restaurant's generated work schedule shows that Chen was scheduled to work either 32 or 40 hours. Id . According to these schedules, Chen was never scheduled to work before or after the Restaurant was open. Defs.' Ex. D and F.

         Most, if not all, of Chen's scheduled work days at the Restaurant were set into two shifts, with Chen scheduled to work 3 to 4 hours, followed by at least a 90 minute break, and then returning to work another 4 to 5 hours. Defs.' Ex. D and F. During trial, the court asked Huang what Chen normally did during the extended break in his schedule. Huang answered that Chen would take a walk or go back and rest in a dormitory located across the street from the Restaurant. Tr. 98:8-18.[4] Huang also testified that, during Chen's entire employment at the Restaurant, he was never required to work beyond the designated hours set in his work schedule. Tr. 98:19-22.

         The court also asked Huang if the Restaurant had any records that showed the actual hours an employee worked, in place of the schedule generated before an employee's shift. Tr. 96:5-14. Huang answered that the Restaurant does use a computer time card, however, she testified that "most of [the] employees... don't want to use the computer... and like [Chen], he [does not] know how to use the computer...." Tr. 96:15-22.

         Rulings of Law

         I. Liability under the FLSA and State Law[5]

         To state a valid FLSA claim, the plaintiff must show by a preponderance of the evidence that: (1) he was employed by the defendants; (2) his work involved interstate activity; and (3) he performed work for which he was under-compensated. Pruell v. Caritas Christi, 678 F.3d 10, 12 (1st Cir. 2012).

         As to the first element, it is uncontested that the plaintiff, for some period of time, was employed by C&R Rock. The parties disagree, however, as to the second and third elements of the plaintiff's FLSA claim.

         A. Interstate Activity

         To satisfy the second element of his FLSA claim, the plaintiff must demonstrate that his work at the Restaurant involved interstate activity. Pruell, 678 F.3d at 12. This may be shown by proving that the employer

(i) has employees engaged in commerce or in the production of goods for commerce, or... has employees handling, selling, or otherwise working on goods or materials that have been moved in or produced for commerce by any person; and (ii) is an enterprise whose annual gross volume ["AGV"] of sales made or business done is not less than $500, 000....

Martinez v. Petrenko, 792 F.3d 173, 175 (1st Cir. 2015) (quoting 29 U.S.C. § 203(s)(1)(A)).

         "A restaurant with over $500, 000 in annual sales satisfies this statutory definition." Cordova v. D & D Rest., Inc., No. 14 CIV. 8789 CS LMS, 2015 WL 6681099, at *3 (S.D.N.Y. Oct. 29, 2015); see also Fermin v. Las Delicias Peruanas Rest., Inc., 93 F.Supp. 3d 19, 33 (E.D.N.Y. 2015) (finding that "it is reasonable to infer that the myriad goods necessary to operate a... restaurant with an eat-in dining area and over $500, 000.00 in annual sales do not exclusively come from [instate]. As a restaurant, it is reasonable to infer that [it] requires a wide variety of materials to operate, for example, foodstuffs, kitchen utensils, cooking vessels, cleaning supplies, paper products, furniture, and more. It is also reasonable to infer that some of these materials moved or were produced in interstate commerce.").

         Here, it is uncontested that defendant C&R Rock owns the Restaurant. Further, Huang, the owner of C&R Rock, testified that the restaurant averages between $70, 000 and $80, 000 in sales every month. Therefore, because the plaintiff has shown that the restaurant averages over $500, 000 in annual sales, he has satisfied the second element of his FLSA claim.

         B. Evidence of Inadequate Compensation

         Employees covered under the FLSA are currently guaranteed a minimum wage of $7.25 for each hour worked. 29 U.S.C. § 206(a). When an employee works beyond 40 hours in one week, the FLSA requires that he or she be compensated "at a rate not less than one and one-half times the regular rate at which he is employed." 29 U.S.C. § 207. New Hampshire law mirrors the federal wage and overtime requirements. See RSA § 279:21.

         Although a plaintiff normally "has the burden of proving that he performed work for which he was not properly compensated, " when an employer has "inaccurate or inadequate" records, the plaintiff "has carried out his burden if he proves that he has in fact performed work for which he was improperly compensated and if he produces sufficient evidence to show the amount and extent of that work as a matter of just and reasonable inference." Anderson v. Mt. Clemens Pottery Co., 328 U.S. 680, 687 (1946). In this scenario, the plaintiff's burden is minimal. Sec'y of Labor v. DeSisto, 929 F.2d 789, 792 (1st Cir. 1991). Indeed, "[s]ufficient evidence may be established by recollection alone." Soli ...

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