California Labor Commissioner Angela Bradstreet has filed a civil action for $425,000 in Contra Costa County Superior Court against Ni Ni Ichi Corporation dba Kane Sushi for illegally taking its worker’s tips and failing to pay split shift premiums as required by California labor law, according to a press release from the California Department of Industrial Relations.

Kane Sushi, with two locations in Danville and Lafayette, was investigated earlier by the California Labor Commission’s Bureau of Field Enforcement at their Danville restaurant. The inspection and ensuing investigation revealed that serious labor law violations were ongoing at both locations.

“Evidence obtained in the investigation established that this employer was appropriating a share of the tips as well as shorting their workers on overtime wages,” said Labor Commissioner Angela Bradstreet. “Under California law, all tips earned by employees are the sole property of the employee who earned them.”

Violations uncovered by the investigation included failing to pay one group of employees (which included chefs, chef helpers and dishwashers among others) for 14 hours of overtime worked. The employer also failed to keep any payroll records on the hours worked for these employees.

Wait staff at the restaurants were paid at minimum wage, $8.00 per hour and received a paycheck for 40 hours worked each week. Those who worked 54 hours per week received cash paid at $8.00 per hour instead of the overtime rate of $12.00. At the end of each shift the owners illegally took 4% off the top of the tips paid by credit card and often took an additional third of the tips before dividing the remainder among wait staff.

The investigation also revealed that after the investigation started, the employer coerced workers to falsify timecards for prior work periods. Employees also report that the employers threatened they would be fired or receive reduced shifts if they attempted to cooperate with the investigators. Eight of the employees have subsequently filed retaliation claims against the owner.

Citations assessing over $500,000 in penalties were also previously issued against Kane Sushi for overtime violations, failure to provide a statement to employees paid in cash detailing all withholdings and failure to maintain accurate payroll records.

The owners appealed the citations and hearing proceedings are ongoing.

The civil action seeks in excess of $350,000 in unlawfully retained tips against the corporate and individual defendants; $30,000 in minimum wages and split shift premiums; $30,000 in liquidated damages and $15,000 in penalties against the corporate defendant.