legal news


Register | Forgot Password

GRODENSKY v. CASINO Part-IV

GRODENSKY v. CASINO Part-IV
12:11:2011

GRODENSKY v

GRODENSKY v. CASINO







Filed 3/11/09


CERTIFIED FOR PUBLICATION

IN THE COURT OF APPEAL OF THE STATE OF CALIFORNIA
FIRST APPELLATE DISTRICT
DIVISION TWO


HARVEY GRODENSKY,
Plaintiff and Respondent,
v.
ARTICHOKE JOE’S CASINO et al.,
Defendants and Appellants.



A119035


(San Mateo County
Super. Ct. No. CIV424170)

HARVEY GRODENSKY,
Plaintiff and Appellant,
v.
ARTICHOKE JOE’S CASINO et al.,
Defendants and Respondents.



A119036


(San Mateo County
Super. Ct. No. CIV424170)


STORY CONTINUE FROM PART III….

Grodensky and the class argue that the present case is distinguishable from those cases holding there is no violation of Labor Code section 351 because, here, patrons gave the tips directly to the dealers and Artichoke Joe’s took the money and then distributed the money to various employees. Grodensky and the class maintain that Labor Code section 351 provides that a tip can be given to an employee or to employees and therefore the Legislature must not have intended that the tip be left for all workers who provided service, because then it would not have distinguished between employee and employees. They assert that, once the tips were given to the dealers and the customers’ intention was that it was just for the dealers, the casino violated the statute by collecting the money and distributing it to other employees. Grodensky and the class proceed to cite the extensive legislative history that establishes that gratuities belong to the employees, and not to the employer.
Grodensky and the class further contend that the lower court improperly relied on Leighton; they maintain that Leighton is limited to the factual context of a waitress in a restaurant (see Brown v. Kelly Broadcasting Co. (1989) 48 Cal.3d 711, 734-735 [“ ‘[T]he language of an opinion must be construed with reference to the facts presented by the case, and the positive authority of a decision is coextensive only with such facts’ ”]). They argue that Leighton and its progeny are limited to the “group tip” context and the Leighton court used equitable principles to conclude that the entire group of employees serving the customer was entitled to a portion of the tip left by the patron. Here, Grodensky and the class argue that, contrary to the “group tip” context, the trial court found the tips were left exclusively for the dealers. They maintain that the Leighton court did not hold that an employer could take a portion of tips belonging to one category of workers, pool them, and then distribute the money to other employees.
Grodensky and the class’s interpretation of the statute and their attempt to limit the holding to the factual context of a waitress in a restaurant or to what they refer to as the “group tip context” is unpersuasive. Grodensky and the class claim that the plain language of the statute distinguishes between gratuities “given to an employee” and those “left for employees” and tips for an employee or employees. However, the statute does not make such a distinction.[1] Labor Code section 351 prohibits an employer from taking any part of a gratuity that is “paid, given to, or left for an employee.” It further states, “[e]very gratuity is hereby declared to be the sole property of the employee or employees to whom it was paid, given to or left for.” (Ibid.) Thus, the statute indicates that the tip may be left for one employee but it may be the property of more than one employee. Moreover, Labor code section 350, subdivision (e) defines a “ ‘gratuity’ ” for purposes of the statute as something that “has been paid or given to or left for an employee by a patron of a business over and above the actual amount due the business for services rendered or for goods, food, drink, or articles sold or served to the patron.” We therefore conclude that the statute simply makes it clear that tips may be left for an employee and be the property of an employee or employees but tips left for an employee are never the property of an employer. (See also Searle v. Wyndham Internat., Inc. (2002) 102 Cal.App.4th 1327, 1332.)
Grodensky and the class maintain that the situation involving the dealers is different from the one involving waitresses because in their situation they are directly given the money after they have winning hands. It is true that the lower court found that the patrons directly gave the dealers the money, but the court stressed that all of the employees were responsible for the customers’ having a good experience while at the casino.[2] It also found that there was “overwhelming evidence” demonstrating that there had been a history of tip sharing by dealers with floor managers, shift managers, and other employees. Thus, dealers would not have voluntarily shared their tips with other employees if they did not recognize the other employees’ contributions in making the customers satisfied. In any event, the application of the statute does not depend upon whether the customers know the money is being shared by all of the people serving them. The statute permits an employer to require an employee to share the tips with all of the employees serving or attending to the customers. Here, the record contained ample evidence to support a finding that all of the employees sharing in the tips serviced the patrons. The shift manager, Michael Sullivan, stated, “We all work together to make this work.” The trial court noted that both the management and employees of Artichoke Joe’s testified consistently that they worked together as a cohesive team to make the casino run smoothly and to keep the patrons happy. Similarly, the court in Louis v. McCormick & Schmick Restaurant Corp. held that requiring waitresses to share a portion of their tips with employees not directly serving the patrons at the tables did not violate Labor Code section 351. (Louis v. McCormick & Schmick Restaurant Corp., supra, 460 F.Supp.2d at pp. 1156-1158; see also Budrow, supra, ___ Cal.App.4th ___ [WL 503359 at *__ ] [no direct table service requirement under the Labor Code section 351].)
We also agree with the trial court that it is immaterial that the casino took the money and then distributed it to other employees. The trial court pointed out that in the present case the casino must take the money first since the tips are left as chips, which must be given to the casino in order to be exchanged for cash. Likewise, often customers in restaurants do not leave cash as tips, but add the gratuity to the credit card bill. Thus, in the latter cases the restaurant temporarily controls the money; what is critical is that the restaurant cannot use the tip money.
Grodensky and the class attempt to circumscribe the holding of Leighton to situations involving an employee waitress and an employer restaurant or to what they refer to as a “group tip” context, but there is nothing in the language or reasoning of Leighton to support such a restriction. To the contrary, the court’s interpretation of the statute applies to all factual situations where tipping is common. The Leighton court elaborated on the policy underlying its interpretation of the statute: “[A]s spelled out in the language of [Labor Code section 351, the purpose of the statute] is to prevent an employer from collecting, taking or receiving gratuity income or any part thereof, as his own as part of his daily gross receipts, from deducting from an employee’s wages any amount on account of such gratuity, and from requiring an employee to credit the amount of the gratuity or any part thereof against or as a part of his wages.” (Leighton, supra, 219 Cal.App.3d at p. 1068.) This policy applies with equal force to the present situation: the tipping of dealers. Labor Code section 351 simply prevents the casino or its agent from taking the gratuity as its own. Here, the casino took the money, but with the exception of giving a portion of the money to its agents, it did not violate the statute because the money was distributed to other employees.
We are also not persuaded by Grodensky and the class’s attempt to distinguish Leighton from the present case by asserting that restaurants, unlike casinos, have a practice of tipping pools. We do not agree that a commercial establishment has to have a long-term practice to be able to impose a tipping pool. Labor Code section 351 does not make such a distinction. The Leighton court discussed the long-term nature of a tipping pool in restaurants simply to point out that the Legislature was aware of this practice and, therefore, the fact that the statute did not outlaw such a practice in any of its numerous amendments to the statute was significant.[3] (Leighton, supra, 219 Cal.App.3d at p. 1067.)
Grodensky and the class also take issue with what he asserts was the trial court’s benefit analysis. The trial court found that the casino did not benefit from its temporary taking of the tips. They maintain that the casino did benefit because it did not have to pay the other employees as much money. We, however, are not concerned with whether the casino benefited from its tip pooling policy. The question before us is whether the mandated-tipping-pool policy violated Labor Code section 351. This question has already been answered in the negative by the Leighton, Jameson, and Budrow courts and we agree with their analyses.
In their reply brief in this court, Grodensky and the class maintain that the casino’s mandatory tipping pool is like a service charge imposed on dealers. (See Searle v. Wyndham Internat., Inc., supra, 102 Cal.App.4th 1332.) A mandatory service charge is a set amount that an employer requires the customers to pay. Grodensky and the class assert that a service charge imposed on customers is legal (see ibid.), but one imposed on the employees is unlawful. We disagree that the mandatory tipping pool is equivalent to a mandatory service charge. The casino requires the dealers to pay between $3 and $5 per hour from their tip money; this money was not deducted from their wages. Further, except for the money that went to the shift managers, which we have already concluded was an unlawful practice, the money did not go to the casino. Accordingly, we reject the attempt by Grodensky and the class to rename “tip pool” as a service charge in an attempt to distinguish the facts of this case from other cases.
Finally, Grodensky and the class contend that, even if we conclude that the tipping pool was lawful, the tipping pool used by Artichoke Joe’s was unlawful because only the dealers contributed to it and the fixed point system was unfair. They claim that the trial court found that other employees also received tips from the patrons, but the casino did not require them to contribute any portion of their tips to the tipping pool. They claim that, for the Leighton analysis to apply, all tip recipients must pool their tips. Further, they maintain that the casino’s fixed point system was not based on a percentage of the tips received, as it was in Leighton and, consequently, the dealers suffered the entire risk of bad tipping.
The problem with this latter argument is that Labor Code section 351 does not address these equitable considerations raised by Grodensky and the class. Rather, the statute’s clear intent is to prevent the public from being defrauded, which could happen if employers or their agents use any portion of the gratuities left for employees for their own benefit. It is not this court’s role to add language to statutes and to create duties or obligations that are not set forth in the statute. Thus, even if Artichoke Joe’s distribution of the gratuities among the various employees was not equitable, such an action did not violate Labor Code section 351.
Accordingly, we conclude that Artichoke Joe’s policy of requiring a tipping pool for the dealers did not violate Labor Code section 351.[4]


B. The Trial Court’s Finding that the Casino Did Not Violate the Minimum Wage Law
The trial court found that Grodensky and the class failed to establish by a preponderance of the evidence that Artichoke Joe’s violated the minimum wage laws under Labor Code section 1194. Grodensky and the class challenge this finding and assert that the casino failed to comply with the minimum wage laws.
The question whether the evidence supported a finding that Artichoke Joe’s did not violate Labor Code section 1194, subdivision (a) is reviewed to determine whether substantial evidence supported this finding. “ ‘When a finding of fact is attacked on the ground that there is no substantial evidence to sustain it, the power of an appellate court begins and ends with the determination as to whether there is any substantial evidence, contradicted or uncontradicted, which will support the finding of fact. [Citations.] [¶] When two or more inferences can reasonably be deduced from the facts, a reviewing court is without power to substitute its deductions for those of the trial court.’ [Citation.]” (Scott v. Common Council (1996) 44 Cal.App.4th 684, 689, quoting Green Trees Enterprises, Inc. v. Palm Springs Alpine Estates, Inc. (1967) 66 Cal.2d 782, 784-785.)
Labor Code section 1194, subdivision (a) provides: “Notwithstanding any agreement to work for a lesser wage, any employee receiving less than the legal minimum wage or the legal overtime compensation applicable to the employee is entitled to recover in a civil action the unpaid balance of the full amount of this minimum wage or overtime compensation, including interest thereon, reasonable attorney’s fees, and costs of suit.”
The trial court found that it was undisputed that every dealer was paid and received a weekly paycheck for the minimum hourly wage regardless of tips and every dealer contributed daily to the tip pool from chips received as tips. Thus, none of the money from the tip pool came from the dealers’ wages and the wages were not below minimum wage. The court observed that all of the dealers received “income from their job significantly in excess of minimum wage, whether on a weekly, monthly, or yearly basis.” Further, the dealers presented no evidence that the tips collected for the pool were used to offset the wages owed.
Thus, here, the record establishes that the casino did not credit tips against or deduct tips from wages it owed the dealer. Moreover, the casino did not pay any of the dealers a salary below minimum wage.
In their briefs in this court, Grodensky and the class cite cases that establish that employees must be paid minimum wage irrespective of any additional tip money they make and they argue that the casino is not really paying the minimum wage because, for each hour it pays, it had previously removed $3 to $5. Grodensky and the class then present a hypothetical. Notably absent from their discussion is any citation to the evidence in the record. Thus, they have clearly not met their burden of establishing that substantial evidence does not support the lower court’s ruling. In any event, their argument is not persuasive. The dealers indisputably received a check for the minimum wage and no money was taken from their paychecks to pay the tip pool. The money taken from the gratuities to pay into the tip pool was not used by the casino to pay the dealers’ salaries; it was used to pay other employees’ tips.
Grodensky and the class argue that when the casino took control of the dealers’ tips, it effectively reduced the wages it pays to the employees and they cite, with almost no analysis, California Drive-In Restaurant Ass’n. v. Clark (1943) 22 Cal.2d 287, 293.[5] In California Drive-In, the employment arrangement was that the tips received by the people serving the cars constituted their wages, and the employer added any amount necessary to ensure that they received the minimum wage. (Id. at p. 290.) The California Drive-In court held that permitting an employer to retain tips received by the employee below the minimum wage “would be a subterfuge for him to receive all the tips and pay the minimum wage. The end result would be counting the tips as a part of the legal wage.” (Id. at p. 293.) The court proceeded to state that the prohibition against the employer’s retaining any portion of the tips “should be strictly limited, and [the statute at that time] would not be violated in instances where the employer retained the entire amount of all tips received above the minimum wage, or deducted the tips from the amount of any wages he agreed to pay in excess of the specified minimum.” (Ibid.)
Thus, the foregoing case provides no support for Grodensky and the class. In the present case, the evidence presented at trial was that no dealer received a regular paycheck, excluding their tips, that was below the minimum wage and no amount of the amount garnered for the tip pool was taken from the regular paycheck.
Grodensky and the class also cite to a California Attorney General opinion in support of their position. (See 3 Ops.Cal.Atty.Gen. 178 (1944).) The Attorney General opined that it would be a violation of an order to require a waitress as a condition of employment “to return 25 [cents] per day, or any amount of the minimum wage paid her for this or any purpose, unless it is a deduction required by law.” (Ibid.) Obviously, an Attorney General opinion from 1944 has limited relevance, but it is clear in this opinion that the Attorney General was concerned that the employer not be able to require any kind of tip sharing that would reduce the waitress’s wage below minimum wage. As already stressed, Grodensky and the class have pointed to no evidence in the record that indicates that the casino pays them less than minimum wage and that any of the money used for the tip pool reduced their wages below the minimum wage requirement.[6]
We conclude that the record supported the lower court’s finding that the casino paid Grodensky and the dealers at least the minimum wage and the money required to be placed in the tip pool was not from the regular pay check but exclusively from the amount collected in tips. Further, the evidence established that the casino did not use any of the tip money to pay the regular salary of the dealers. Accordingly, we affirm the lower court’s finding that the casino did not violate Labor Code section 1194, subdivision (a).
C. The Trial Court’s Finding that Floor Managers are Not Agents
A tipping pool is permissible under Labor Code section 351 as long as the tips are shared with employees and not taken by the employer or its agent. Here, the trial court found that the dealers’ tips could be shared with the floor managers as it ruled that they were not agents under Labor Code section 350, subdivision (d). Grodensky and the class challenge this finding.
Labor Code section 350 defines the words “employer” and “agent” as they are used in Labor Code section 351. “ ‘Agent’ means every person other than the employer having the authority to hire or discharge any employee or supervise, direct, or control the acts of employees.’ ” (Lab. Code, § 350, subd. (d).) “ ‘Employee’ means every person, including aliens and minors, rendering actual service in any business for an employer, whether gratuitously or for wages or pay, whether the wages or pay are measured by the standard of time, piece, task, commission, or other method of calculation, and whether the service is rendered on a commission, concessionaire, or other basis.” (Lab. Code, § 350, subd. (b).)
Grodensky and the class argue that we should reverse as a matter of law because the lower court interpreted the statute to require that Grodensky and the class show that the floor manager had “substantive” authority to hire or discharge any employees or supervise, direct, or control the acts of employees. They complain that the trial court used a more stringent standard than the one set forth in the statute. The trial court stated that it interpreted the statute to mean that the “supervision, direction, and/or control [must be] of a substantive nature.” It proceeded to explain, “If a dealer asks the janitor to clean up a spill at the table, that does not make the dealer a person who ‘directs or controls’ the acts of the janitor.” Thus, the court was merely clarifying that occasionally directing someone to do something would not make a person an agent under the statute. We do not agree with Grodensky and the class that the lower court created a higher standard for supervision; the trial court was simply explaining that there had to be a regular rather than an occasional exercise of authority. Accordingly, we review the record to determine whether substantial evidence supported the trial court’s ruling. (See our discussion of this standard of review, part II.B, ante.)
Here, the trial court pointed out that the job title of manager did not prove that the floor manager had actual supervisory powers over the dealers. It also noted that the manual indicated that floor managers supervised the dealers, but it correctly concluded that this was not dispositive of the issue. The undisputed evidence in the record was that floor managers did not have the authority to hire or fire any employee. Floor managers also did not schedule the dealers’ shift assignments or approve vacation or medical leave. They also had no role in the setting of wages or benefits or work hours of employees. They also did not handle matters such as dealers’ being late or absent.
The trial court found that the “key responsibility” of a floor manager was to resolve disputes at the game tables between customers or disputes between a dealer and customer. The dealer was never supposed to get into an argument with the customers, but was just supposed to deal the cards. The court summarized the floor managers’ duties as “to start games, greet customers, see that games run smoothly, change cards for games, prevent cheating, make rulings on misdeals or disputes, and protect dealers from abuse of patrons (by getting rid of troublemakers).”
Grodensky and the class contend that Bachman conceded that floor managers were the immediate supervisors of the dealers. Bachman testified that the floor managers had the authority to handle disputes between the dealer and customers. Bachman stated that the floor manager could tell dealers that they had to deal with a player who was being obnoxious at the table. Also, the floor manager could tell the dealer who should receive the “pot” when a dispute as to the winner of a hand arose. Further, a floor manager could complete a form that indicated a concern about a dealer’s performance. Bachman stated that he relied “in part” on these evaluations on the forms when determining whether dealers were following the rules.
The court considered the foregoing evidence, but noted that all written notices of card room violations had to be countersigned by Bachman or Willson. Bachman investigated the violations. Further, the evidence indicated that the floor managers did not regularly draft written notices of violations. Since the evidence showed that these notices had no effect without the signing of Bachman or Willson, the record supported a finding that the floor managers did not have the authority to discipline the dealers.
We conclude that the record supported the lower court’s findings that the floor manager was not an agent. Although there was some evidence that the floor manager had some authority over the dealers, the record established that the floor managers’ principal responsibility was to ensure the games ran smoothly. The undisputed evidence was that they did not have the authority to hire or discharge dealers and the evidence supported a finding that they did not supervise, direct, or control the acts of the dealers.
D. The Trial Court’s Dismissal of the Conversion Claim
The trial court dismissed the claim of conversion by Grodensky and the class. The court found that there was nothing unwarranted or wrongful in requiring the dealers to share their tips, and therefore Grodensky and the class did not establish all of the elements of conversion. The court stated that the only wrongful conduct alleged for purposes of the conversion claim arose from the violation of Labor Code section 351, and the court declared that Grodensky and the class were limited to statutory remedies. The court stated that it would not permit the statutory claim to “metamorphosize into a tort claim seeking punitive damages.”
In his pleading, Grodensky and the class based their claim of conversion on the alleged violation of Labor Code section 351.[7] In their briefs in this court challenging the dismissal of this claim, they set forth the elements of conversion[8] and assert that they presented evidence to support each element. Grodensky and the class, however, do not address the basis for the court’s ruling that Grodensky and the class are limited to the statutory remedy set forth by the Legislature.
“As a general rule, where a statute creates a right that did not exist at common law and provides a comprehensive and detailed remedial scheme for its enforcement, the statutory remedy is exclusive. [Citations.] But where a statutory remedy is provided for a preexisting common law right, the newer remedy is generally considered to be cumulative, and the older remedy may be pursued at the plaintiff’s election.” (Rojo v. Kliger (1990) 52 Cal.3d 65, 79.) As the issue presented is entirely legal in nature, we employ our independent judgment. (Gatto v. County of Sonoma (2002) 98 Cal.App.4th 744, 753.)
While we are not aware of any California cases on point, federal courts have held that the Labor Code provides a comprehensive and detailed remedial scheme that provides an exclusive statutory remedy. (See Thomas v. Home Depot USA Inc. (N.D. Cal. 2007) 527 F.Supp.2d 1003 [claim for conversion of wages owed for working through rest and meal periods based on violation of Labor Code was improper because Labor Code provided exclusive remedy]; In re Wal-Mart Stores, Inc. Wage and Hour Lit. (N.D. Cal. 2007) 505 F.Supp.2d 609, 618-619 [claim for conversion based on violations of Labor Code improper]; Pulido v. Coca-Cola Enterprises, Inc. (C.D. Cal., May 25, 2006, No. EDCV06-406VAP (OPX)) [2006 WL 1699328, at *9] [no claim for conversion when claim based on violation of Labor Code section 226.7]; Green v. Party City Corp. (C.D. Cal., Apr. 9, 2002, No. CV-01-09681) [2002 WL 553219, at *4] [no claim for conversion when claim based on alleged statutory violation of the Labor Code for overtime pay].) Thus, the federal courts have consistently rejected any tort claims based on a violation of the Labor Code.
We agree that a claim for conversion based on an alleged violation of Labor Code section 351 is improper. Gratuities were not even considered the employees’ property until Labor Code section 351 was amended in 1973. (See Henning, supra, 46 Cal.3d at p. 1273.) Thus, an employee did not have a common law right to his or her gratuity. “ ‘ “ ‘Where a new right is created by statute, the party aggrieved by its violation is confined to the statutory remedy . . . .’ ” ’ ” (Stevenson v. Superior Court (1997) 16 Cal.4th 880, 900.) Since Labor Code section 351 created a right and did not simply provide a new remedy for a preexisting right, Grodensky and the class cannot base their tort claim for conversion on a violation of Labor Code section 351.
E. Alleged Violations of Labor Code Section 221 and Section 450, Subdivision (a) as a Basis for a UCL Claim
The trial court ruled that the mandatory tip pool program did not violate Labor Code section 221 and section 450, subdivision (a). It therefore rejected any contention that any alleged violation of these statutes could be grounds for the UCL claims.
On appeal, Grodensky contends the record supported a finding that the casino violated Labor Code section 221 and section 450, subdivision (a). We review whether the record supported a finding of no violation of these statutes under the substantial evidence test. To the extent that we must interpret the statute, we review the lower court’s finding de novo.
1. Labor Code Section 221
Labor Code section 221 provides, “It shall be unlawful for any employer to collect or receive from an employee any part of wages theretofore paid by said employer to said employee.” Labor Code section 200, subdivision (a) reads, “ ‘Wages’ includes all amounts for labor performed by employees of every description, whether the amount is fixed or ascertained by the standard of time, task, piece, commission basis, or other method of calculation.” Labor Code section 350, subdivision (e) defines gratuity as follows: “ ‘Gratuity’ includes any tip, gratuity, money, or part thereof that has been paid or given to or left for an employee by a patron of a business over and above the actual amount due the business for services rendered or for goods, food, drink, or articles sold or served to the patron. . . .”
Under this statute, wages do not include tips or gratuities because tips are not owed by the employer. As discussed earlier, the record supported the lower court’s finding that the casino paid the dealers the wages owed and no part of the dealers’ wages was used for the tipping pool. The casino therefore did not collect or receive any part of the dealers’ wages, and the trial court properly found no violation of Labor Code section 221.
2. Labor Code Section 450, Subdivision (a)
Labor Code section 450, subdivision (a) states: “No employer, or agent or officer thereof, or other person, may compel or coerce any employee, or applicant for employment, to patronize his or her employer, or any other person, in the purchase of any thing of value.” The intent of the Legislature when enacting Labor Code section 450 was to protect wage earners against coercion to purchase products or services from the employer. (California State Restaurant Assn. v. Whitlow (1976) 58 Cal.App.3d 340, 347.)
Grodensky argues that the dealers were forced to purchase their jobs with their tips. He, however, ignores the legislative intent for enacting Labor Code section 450, subdivision (a), which was to prevent an employer from compelling an employee to purchase products or services. The statute bars an employer from compelling an employee to “patronize his or her employer, or any other person, in the purchase of any thing of value.” (Lab. Code, § 450, subd. (a).) Here, the dealers were not forced to purchase any products or services. Further, tips belong to the employees serving the customers, and therefore mandatory tip sharing among employees is legal. (Leighton, supra, 219 Cal.App.3d at pp. 1069, 1071 [a tip pool “protects the personal property of the employees and ensures a fair distribution of the gratuity to those who earned it, making certain that each gets his fair share”].) The tips are the property of the casino employees, not simply the dealers. Thus, the dealers have not had to pay to other employees any of the money that belongs solely to them. To the extent that the sharing of the tips among the agents of the casino violated any statute, the trial court found, and we have affirmed, that this practice violated the law and was the proper basis for a UCL claim.
DISPOSITION
That portion of the judgment regarding the award of attorney fees to Grodensky is reversed and remanded for proceedings consistent with this opinion. The judgment is otherwise affirmed. No costs are awarded.



_________________________
Lambden, J.


We concur:


_________________________
Kline, P.J.


_________________________
Richman, J.



Publication courtesy of San Diego pro bono legal advice.
Analysis and review provided by Poway Property line attorney.
San Diego Case Information provided by www.fearnotlaw.com


Trial Court: San Mateo County Superior Court

Trial Judge: Hon. Marie S. Weiner


Attorneys for Defendants and Appellants: Kauff McClain & McGuire LLP
Artichoke Joe’s Casino et al. Maureen E. McLain
Robert D. Links

Attorneys for Plaintiff and Respondent: Spiro Moss Barness LLP
Harvey Grodensky Dennis F. Moss

Law Offices of Andrew Kopel
Andrew R. Kopel




[1] As already noted, Labor Code section 351 reads: “No employer or agent shall collect, take, or receive any gratuity or a part thereof that is paid, given to, or left for an employee by a patron, or deduct any amount from wages due an employee on account of a gratuity, or require an employee to credit the amount, or any part thereof, of a gratuity against and as a part of the wages due the employee from the employer. Every gratuity is hereby declared to be the sole property of the employee or employees to whom it was paid, given, or left for. . . .”

[2] The trial court found the following: “Tips are given to dealers by patrons directly. Almost always the tipper is the player with the winning hand. A tip is then given to the dealer by either a soft toss, or pushing the chip towards the dealer, or handing the chip to the dealer. It is the policy of Artichoke Joe’s that when a dealer is given a tip by a player, the dealer must acknowledge the tip, take the chip(s), put the tip in his/her pocket, and verbally say ‘Thank you’ to the patron.” (Fn. omitted.) The court noted that Grodensky and the class submitted evidence of polls taken of patrons at Artichoke Joe’s, which showed that “a significant, although minority, percentage of such customers were ‘surprised’ and/or did not know or understand[] that tips given to dealers would be shared with other employees . . . .” The fact that some customers may not have known that tips were shared does not indicate that none of the other employees contributed to the customers’ having a pleasant experience at the casino.

[3] The casino asserts that it had a long-time policy of a tipping pool. Indeed, the trial court found that “[t]he overwhelming evidence demonstrates that tip sharing by dealers with floor managers, shift managers, and other employees of the card room was commonplace, long-standing, and consistent with industry practices for decades.” Grodensky and the class counter that there has been a history of tipping out, not of a tipping pool. They assert that tipping out is not the same as a tipping pool because the dealers have control over what to do with their tips when there is tipping out. We need not consider the differences between a tipping pool and tipping out because our holding does not require that the commercial establishment have a history of a tipping pool. Again, the reason the Leighton court pointed out the history of tipping pools is to note that the Legislature must have been aware that they existed and could have prohibited them by amending the statute if that was the Legislature’s intent.

[4] Since we conclude that the express language of the statute and the holdings of court opinions compel this holding, we need not consider the casino’s argument that the Department of Labor Standards Enforcement has supported the holdings of Leighton and Jameson in a 1998 opinion letter and in a 2005 opinion letter.

[5] California Drive-In Restaurant Ass’n. v. Clark was decided when it was lawful for an employer to take employees’ tips.

[6] The trial court would not permit specific evidence of the income for individual dealers, finding that concerns over their privacy rights trumped any probative value of this evidence. Grodensky testified that he made between $100 and $250 per day in tips, and he believed that his tips fell into the middle range as compared to other dealers. He also stated that his contribution to the tip pool was $34 per eight-hour shift. The casino card room manager, Bachman, testified that casino dealers earned between $150 to $800 per day in income.

[7] Specifically, Grodensky and the class alleged in their cause of action for conversion the following in pertinent part: “Labor Code section 351 provides that gratuities are the sole property of the employee, to whom they are paid or given. By the conduct alleged herein, defendants wrongfully exercised dominion over a portion of the gratuities of the class members. As a result, plaintiff and the class members have been denied the possession, use and enjoyment of their gratuities and have been otherwise damaged in an amount to be proved at trial.”

[8] The elements of conversion “ ‘are the plaintiff’s ownership or right to possession of the property at the time of the conversion; the defendant’s conversion by a wrongful act or disposition of property rights; and damages. It is not necessary that there be a manual taking of the property; it is only necessary to show an assumption of control or ownership over the property, or that the alleged converter has applied the property to his own use. [Citations.]’ [Citation.] Money can be the subject of an action for conversion if a specific sum capable of identification is involved.” (Farmers Ins. Exchange v. Zerin (1997) 53 Cal.App.4th 445, 451-452.)




Description Artichoke Joe's Casino (Artichoke Joe's or the casino) implemented a mandatory tip pooling policy for the dealers. A dealer, Harvey Grodensky, filed a class action and alleged claims for conversion and violating Labor Code sections 351 and 1194. He also claimed in his representative capacity that the casino had violated the Unfair Competition Law (UCL). After a bench trial, the trial court found that a mandatory tip pool was legal. However, it determined the shift managers were agents of the casino and therefore the casino violated Labor Code section 351 by distributing a portion of the tip money to the shift managers. The court also found that this violation of the Labor Code supported Grodensky's UCL claim. The court ordered restitution for the amount of tip money given to the shift managers and issued an injunction. It also ruled that Grodensky was entitled to an award of attorney fees under Code of Civil Procedure section 1021.5. Both parties appealed and we, on our own motion, consolidated the appeals.
On appeal, Artichoke Joe's asserts that a protective order issued by the trial court was unlawful, that Labor Code section 351 did not provide Grodensky with a private right of action, and that restitution was not a proper remedy. It also challenges the court's award of attorney fees to Grodensky and the class. We agree that the lower court did not apply the proper test under Code of Civil Procedure section 1021.5 when determining that Grodensky was entitled to attorney fees and remand for the court to consider whether to award attorney fees using the proper test. We otherwise reject the casino's arguments.
In the appeal by Grodensky and the class, they argue that the trial court erred in finding that the mandatory tipping pool did not violate Labor Code section 351 and that the casino did not violate Labor Code section 1194. They also object to the lower court's rulings that the floor managers were not agents under Labor Code section 350, subdivision (d), that Grodensky could not bring a claim of conversion, and that Grodensky and the class did not have a UCL claim based on alleged violations of Labor Code sections 221 and 450. We are not persuaded by any of Grodensky and the class's arguments.
Rating
0/5 based on 0 votes.

    Home | About Us | Privacy | Subscribe
    © 2024 Fearnotlaw.com The california lawyer directory

  Copyright © 2024 Result Oriented Marketing, Inc.

attorney
scale