The U.S. Department of Labor is suing an Iowa City-area company, accusing the establishment of repeatedly violating federal law by underpaying its employees.
The lawsuit was filed in the U.S. District Court for the Southern District of Iowa against Mexico Lindo Grill & Cantina, a Mexican restaurant with locations in Iowa City, North Liberty and West Liberty.
The suit alleges that at least 25 employees were paid “at rates less than the applicable statutory minimum wage rate,” and were not properly paid for overtime work for two years between August 2022 and August 2024.
Mexico Lindo management also allegedly paid certain servers only through direct cash and tips from customers and failed to meet the required $7.25 per hour federal minimum wage.
The restaurant also allegedly failed to “make, keep and preserve adequate and accurate time records regarding their employees,” including records of employees’ names and social security records, how many hours they work each week, their regular hourly wage and how much they earned in a week
Mexico Lindo violated the Fair Labor Standards Act “willfully” and “repeatedly,” the lawsuit alleges. Mexico Lindo did not respond to a request for comment.
Government asks restaurant to pay workers ‘back wages’ in full
The lawsuit demands that Mexico Lindo pay any unpaid “back wages” and additional damages to the 25 employees listed. The attorney also said there may be a few employees who were not properly paid unbeknownest to the Department of Labor because of the restaurant’s record-keeping.
“Back pay,” as the labor department defines it, means that the employer must compensate workers for the full amount that they should have been paid without the Fair Labor Standards Act violations.
The lawsuit does not mention specifically how much money the restaurant allegedly owes its employees.
Back pay can be recovered for up to three years after a violation in the case of “willful violations,” according to the Department of Labor website. If the violations were not willful, then back wages only have a two-year statute of limitations.
Representatives with Mexico Lindo have returned calls from the Press-Citizen.
(This article has been updated to add new information.)
Ryan Hansen covers local government and crime for the Press-Citizen. He can be reached at rhansen@press-citizen.com or on X, formerly known as Twitter, @ryanhansen01.
This article originally appeared on Iowa City Press-Citizen: Labor department sues Iowa City Mexican restaurant, says it paid workers less than minimum wage
Reporting by Ryan Hansen, Iowa City Press-Citizen / Iowa City Press-Citizen
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