Wind Creek to Pay $6m Settlement in Tip Case

The Poarch Band of Creek Indians of Alabama is the owner of the Wind Creek Bethlehem casino in Pennsylvania. The tribe took ownership of the Sands Bethlehem and turned it into a Wind Creek facility. Since taking ownership, the tribe has been hit with a lawsuit based on tip credits and license cost deductions. A settlement of $6 million has been reached with over 3,000 employees of the casino and it was just approved by a federal judge in the US District Court of Philadelphia.

The Lawsuit

The main issue of the lawsuit is whether or not the casino had provided notification about tip credits to employees working at the casino who are making less than minimum wage. Another part of the lawsuit focused on the deduction of the gaming license cost from employee earnings by Wind Creek.

The settlement reached for the tips will give each person named in the lawsuit just over $2,000 in restitution. The licensing problem will result in $102 provided to each individual. Around one-third of those named in the lawsuit are connected to both issues.

Based on federal law, employers can pay workers less than minimum wage if the individual is able to make enough tips to meet the difference. The difference in payment is known as a tip credit. Last March, a former table games dealer decided to sue the casino due to tip credit issues.

Jacob Bartakovits was making just $4.25 an hour plus tips from August 2018 to October 2019. The minimum wage currently in the state is $7.25. The dealer filed the suit and claims that the casino did not inform workers about the federal provisions associated with tips. The suit also listed the gaming license fee which was deducted from wages, a requirement for individuals to be able to work at the casino.

The Tribe says they are not in the wrong and agreed to the settlement as a compensation fund in order to avoid any further legal issues. The final settlement will be sent to Judge Joseph F. Leeson Jr. of the United States District Court on September 8.

Lower Wages

In casinos across the United States, there are individuals working for lower than minimum wage and they rely on tips to compensate for the lower-income earnings. From restaurant workers to cocktail servers, and even dealers, casinos offer varying wages including those that are lower than $7.25.

For many people, this is not enough to get by. They work weekends or night shifts to be able to pick up extra tips in order to pay rent and other necessities like food and utilities. Is it fair that the employees are working less than minimum wage? For the most part, tips help to meet the difference and, in some cases, even provide more than the traditional wages would.

Some lawmakers are trying to increase the minimum wage to $15 across the United States. This would help to provide more earnings for people who make only minimum wage or those who are working for less than the standard amount. So far, the effort has not moved forward but we may see a renewed push in the coming months.

For now, the former and current employees listed in the Wind Creek lawsuit will be provided compensation for earnings not provided or taken away by the operator in the past.

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Rebecca
Rebecca lives in Las Vegas and after completing her degree at Reynolds Journalism school joined the USGS team to pursue her journalism dreams.