An operator of Houlihan’s restaurants in New Jersey and New York has agreed to pay $5 million in a consent judgment after the U.S. Department of Labor accused it of illegally pocketing a portion of servers’ and bartenders’ tips.

The Department of Labor had accused A.C.E.  Restaurant Group of misappropriating employees’ tips, in violation of the Fair Labor Standards Act, and paying tipped employees less than minimum wage, without fully complying with relevant regulations under the FLSA. The Labor Department also charged that A.C.E. allowed some employees to work at two or more of its locations for a total of more than 40 hours per week, without paying overtime to those employees.

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