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Meeting the Minimum Wage

How much “side work” can tipped employees do and still be paid a wage of $5.08/hr plus tips in Florida?

By Tom Harper, Law and Mediation Offices of G. Thomas Harper, LLC (Tom@EmploymentLawFlorida.com)

In a decision dated May 18, 2017, federal District Judge James Moody of the Middle District of Florida has upheld the Department of Labor’s (“DOL”) policy that a tipped employee qualifies to be paid a lower direct wage than the Florida Minimum wage of $8.10/hr only if the employee spends no more than 20% of his time on duties that do not directly result in making tips for the employee.

In the case before Judge Moody, Robert Eldridge worked as a server and bartender at an Outback Steakhouse in St. Petersburg. Eldridge sued his employer, OS Restaurant Services, LLC, a/k/a Outback Steakhouse of Florida LLC, for unpaid wages and overtime. Eldridge claimed that he spent more than 20% of his time on manual duties that were not directly related to receiving a tip and as a result, his employer violated the law by paying him the lower minimum wage and taking the tip credit to make up the difference. Eldridge argued that since he spent over 20% of his time on side duties, he should have been paid minimum wage, and not the tip credit wage. His employer moved to dismiss his suit claiming that the DOL’s 20% rule did not apply. The court ruled that the 20% rule did apply and refused to dismiss Eldridge’s claims.

Background:

Under the Fair Labor Standards Act (FLSA) which is the federal wage/hour law, employers are allowed to claim a “tip credit” toward satisfying the minimum wage law for their tipped employees. This means that tips are credited against, and satisfy a portion of, the employer’s obligation to pay the minimum wage. In 2017, however, the Florida state minimum wage is $8.10/hr, higher than the federal minimum wage of $7.25/hr.

Florida’s state Constitution provides that “For tipped Employees meeting eligibility requirements for the tip credit under the FLSA, employers may credit towards satisfaction of the Minimum Wage tips up to the amount of the allowable FLSA tip credit in 2003.”  The FLSA tip credit in 2003 was $3.02. Back in 2003 the federal tip credit was calculated by subtracting the federal reduced minimum wage of $2.13/hr from the federal minimum wage of $5.15/hr. This subtraction resulted in a tip credit of $3.02/hr.  Therefore, under the Florida Constitution, the tip credit can be no more than $3.02. So, in Florida, as the minimum wage increases, the $3.02 tip credit stays the same, and the direct wage (also called a subminimum wage) that must be paid to the employee increases. As of January 1, 2017, the direct wage (also referred to as a subminimum wage) equals the Florida minimum wage ($8.10) minus the 2003 tip credit ($3.02), or $5.08/hr. Thus, for those tipped employees who meet certain requirements, employers are only required to pay the employee $5.08/hr. The rest of the minimum wage is made up through the tips that the employee collects.

The Job in Question:

Eldridge worked as a server and bartender at Outback. One of his claims was that his employer violated Florida law by paying him the lower, subminimum wage, for jobs he performed that did not result in tips. The court agreed. In his suit, he laid out the following duties that he claimed he regularly performed that required more than 20% of his work hours.

  1. Bar set up assignments: Stocking and icing milk and cream; Stocking coffee, tea, bottled drinks; Brewing coffee and tea; Stocking glasses, straws, napkins, coffee cups and saucers; Cutting lemons, limes, and bar fruit; Putting garnishes on ice such as lemons and limes; Cleaning, adjusting, and connecting beer kegs; Replacing empty CO2 tanks with back-up canisters; Replacing syrup containers for soda machines; Cleaning soda dispenser nozzles; Washing dirty glassware behind bar; Polishing glassware; Setting up or putting away bar mats; Performing inventory checks or “facing” bottles.
  2. Table set up, break down, and cleaning projects: Cleaning and wiping the wait station; Cleaning and wiping table tops; Cleaning and wiping chairs and booths; Cleaning and wiping menus; Aligning and straightening chairs; Taking down or putting up chairs; Setting tables – silverware, plates, glassware, napkins, caddies; Stocking sugar, sweeteners; Refilling salt and pepper; Cleaning condiment holders; Stocking or filling ketchup or table sauces; Rolling silverware; Polishing silverware, organizing, or moving silverware to front of house.
  3. Maintenance and janitorial undertakings: Placing trash cans in designated areas; Checking restrooms for cleanliness and supplies; Wiping water from sinks in restrooms; Dusting lamps, shelves, or picture frames in dining room; Performing general cleaning; Stocking printer paper, when back-up rolls were needed; Checking entry and wait area floors, and cleaning if necessary; Checking floors and sweeping and mopping if necessary; Washing dishes.
  4. Undesignated skeleton crew duties to maintain restaurant performance to save the defendant on overhead and labor costs.

In deciding whether Eldridge’s claim was valid, the court looked to the DOL Regulations which became effecting in April of 2011. The regulations provide that where an employee is engaged in two occupations, one of which is tipped and one of which is not, the employer may not take a tip credit for the hours the employee worked in the non-tipped occupation. On the other hand, the regulations go on to distinguish “a waitress who spends part of her time cleaning and setting tables, toasting bread, making coffee and occasionally washing dishes or glasses” is still subject to a tip credit.

The 20% rule came from the 1988 DOL Field Operations Handbook which states that employees who spend more than 20% of their time performing general preparation work or maintenance are not subject to a tip credit for the time spent performing those duties.  Eldridge’s employer, Outback Steakhouse in St. Petersburg argued to the court that the 20% rule was not binding authority in Florida. Indeed, the court acknowledged that our federal court of appeals over Florida has never ruled on this question.

The federal court in Tampa researched this issue and found that a number of federal courts had sided with the DOL and found that their interpretation was reasonable. The court noted that the Eighth Circuit Court of Appeals stated that, “[t]he regulation places a temporal limit on the amount of related nontipped work an employee can do and still be considered to be performing a tipped occupation.” The Eighth Circuit case found that the 20% rule was a reasonable way to interpret terms in the regulations like “part of the time” and “occasionally.” Thus the Florida court upheld the 20% rule for employers and denied the employer’s motion to dismiss this claim by Eldridge. Robert Eldridge v. OS Restaurant Services, LLC A/K/A Outback Steakhouse of Florida LLC, Case No: 8:17-CV-798-T-30TGW (M.D. Fla., May 18, 2017)

Remember These Points:

The DOL regulations state that an employer must provide the following information to tipped employees before using the tip credit:

  1. The amount of cash wages the employer will pay tipped employees (in Florida, at least $5.08 per hour);
  2. The additional amount claimed by the employer as a tip credit (in Florida, at least $3.02/hr);
  3. An explanation that the tip credit claimed by the employer cannot exceed the amount of tips actually received by tipped employees;
  4. An explanation that all tips received by tipped employees are to be retained by employees except for a valid tip-pooling arrangement that is limited to employees who customarily and regularly receive tips; and
  5. A statement that the tip credit will not be applied to tipped employees unless they have been informed of the tip credit provisions.

Under the DOL regulations the employer may provide oral or written notice to tipped employees to inform them of the tip credit provisions. Further, the regulations state an employer must be able to show that it has provided notice. They also state an employer that fails to provide the required information cannot use the tip credit provisions and must pay tipped employees at least $7.25 per hour ($8.10/hr. in Florida) and allow them to keep all tips received. To make it easier to prove that the notice has been furnished to employees, written notice should be provided. Employers electing to use a tip credit must be able to show that tipped employees received at least minimum wage when direct (or cash) wages and the tip credit amount are combined. If an employee’s tips and the direct wage of at least $5.08 do not equal the minimum wage of $8.10, the employer must make up the difference.

 Tip pooling The 2011 regulations allow for tip pooling among employees who customarily and regularly receive tips, such as servers, bellhops, and bartenders. Conversely, a valid tip pool may not include employees who do not customarily and regularly receive tips, such as dishwashers, cooks, chefs, and janitors. One factor that helps determine who may be included in a tip pool is employee interaction with customers. The regulations state that if a tipped employee is required to contribute to a tip pool that includes employees who do not customarily and regularly receive tips, the employee is owed all tips she contributed to the pool and the full $8.10 minimum wage. One positive change: The 2011 regulations did not impose a maximum contribution amount or percentage on valid mandatory tip pools. However, the employer must notify tipped employees of a required tip-pool contribution amount and may take a tip credit only for the actual tips each tipped employee ultimately receives.
Whose tip is it? The regulations state that tips are the sole property of tipped employees regardless of whether the employer takes a tip credit. The regulations prohibit any arrangement between the employer and tipped employees in which any tips become the property of the employer. The DOL’s 2011 final rule amending its tip credit regulations specifically sets out the WHD’s interpretation of the FLSA’s limitations on an employer’s use of employees’ tips when a tip credit is not taken. The rule states in pertinent part:

Tips are the property of the employee whether or not the employer has taken a tip credit. The employer is prohibited from using an employee’s tips, whether or not it has taken a tip credit, for any reason other than that which is statutorily permitted: as a credit against its minimum wage obligations to the employee, or in furtherance of a valid tip pool.

Service charges A compulsory charge for service (e.g., a charge placed on a ticket when the number of guests at a table exceeds a specified number) is not a tip. Service charges cannot be counted as tips, but they may be used to satisfy the employer’s minimum wage and overtime obligations under the FLSA. If an employee receives tips when a compulsory service charge is added, the tips may be considered in determining whether he is a tipped employee and in applying the tip credit. If tips are placed on a credit card and the employer must pay the credit card company a fee, the employer may deduct the fee from the employee’s tips. Further, if an employee does not receive sufficient tips to make up the difference between the direct wages and the minimum wage, the employer must make up the difference. If an employee receives only tips and is not paid a cash wage, the employer owes the full minimum wage.
Deductions Deductions from an employee’s pay for walkouts, breakage, or cash register shortages that reduce her wages below the minimum wage are illegal. If a tipped employee is paid $5.08 per hour in direct wages and the employer claims the maximum tip credit of $3.02 per hour, no deductions can be made without reducing the employee’s pay below the minimum wage (even if the employee receives more than $3.02 per hour in tips). Computing overtime for tipped employees If the employer takes a tip credit, it must calculate overtime based on the full minimum wage, not the lower direct wage. The employer may not take a larger tip credit for overtime hours than for straight-time hours. For example, if an employee works 45 hours during a workweek, he is owed 40 hours at $5.08 in straight-time pay and five hours of overtime at $9.13 per hour ($8.10 x 1.5 – $3.02 in tip credits). Bottom line The rules for paying tipped employees are so complicated and fraught with potential pitfalls that some employee’s side attorneys specialize their practices in challenging these pay systems. While the common mistakes may not amount to much money per employee, the liability can add up to big dollars when the mistakes involve many employees over several years. Take care to audit your pay systems periodically, train your employees on the proper pay procedures, and respond to any employee complaints or concerns about pay ― before they turn into a lawsuit.

Trial of FMLA Claim

Tampa Jury finds FMLA violation. Court awards $81,400.00-so far

By: Tom Harper, The Law and Mediation Offices of G. Thomas Harper, LLC

On February 22 a 6-person jury in federal court in Tampa awarded $40,700.00 in back wages to a terminated employee of Beltram Edge Tool Supply, Inc., who was fired while out on FMLA leave. On April 14, the court awarded an equal amount to the jury verdict in liquidated damages ($40, 700.00) to Ms. Regena White, the fired employee. The case addressed several issues that are of interest to Florida employers including the type of notice that an employee must provide to qualify for FMLA, and whether an employer can deny reinstatement and terminate when the employee’s doctor estimates that the employee will not be able to return to work in 12 weeks. Here is what the employee claimed happened, and presented to the court.

A First Mis-Step

Regena White began working for Beltram Edge Tool Supply, Inc. (“Beltram”) in

2003 as an Accounts Payable/Accounts Receivable Supervisor. She supervised

between 2 to 4 specialists in the accounts receivable and accounts payable

department. In addition to normal office-type duties, Regena had to walk around the three buildings that the company occupies to meet with salespersons to work out commission and billing problems. Beltram used an out-of date employee handbook that did not mention the FMLA and the company did not post the required FMLA notices to employees.

In April of 2010 Regena stepped on her leg and tore her ACL in her left knee. Her doctor said that she may need surgery, but Regena opted for physical therapy and returned to work. (No FMLA was offered or mentioned.)  Beginning in November of 2010, Regena began suffering from several other medical conditions including migraine headaches, anxiety attacks, shortness of breath and irregular heart rate. She missed some work, but FMLA was not mentioned or taken. Her health issues continued and Regena missed a lot of work in January 2011, but frequently called in to her supervisor, Jim Reeverts, to tell him about her medical problems.  She was referred to a cardiologist for tests on her heart. In late January, she was released by her doctor to return to work on January 31. But before she returned, she had an accident at home on January 26 while descending the stairs. Her left knee “gave out” on her while walking down the stairs and she fell. (This was the same knee that she had a torn the ACL.)  Her knee became swollen and she could not put any pressure on it or walk and she had great pain in her knee. Her doctor referred her to an orthopedic specialists to see what had happened.

On January 28 her supervisor’s boss, Xio Polewalski, Beltram’s V.P. of Operations, e-mailed to Regena the WH- 380 E form (Certification of Serious Health Condition) for Regena to take to her doctor. Beltram gave her no other info such as the required notice about FMLA rights (WH- 381) or a Designation Notice of FMLA (WH-382).  She was told to return the medical certification form by February 12. Her orthopedic surgeon told Regena that she needed left knee ACL (anterior cruciate ligament) reconstruction, and a repair of the meniscus. Surgery was scheduled for late February, but her doctor had to take a medical leave and Regena was transferred to a different doctor and the surgery was delayed.

Medical Certification

With the change in doctors, on February 11 Regena contacted Ms. Polewalski and told her she could not return the certification by February 12. According to Regena, Polewalski responded, “just get it in as soon as possible.” Ms. Polewalski also asked Regena to send doctor excuses about her absences since late December. Regena provided two doctor excuses, but one of the excuses said that Regena could return to work on January 31. That note had been written before the stairway fall that reinjured Regena’s left knee, but Beltram did not know that. When the serious health condition certification form was not received by February 16, Beltram made the decision to fire Ms. White. On February 17 one of Regena’s own employees at Beltram contacted her to say that Beltram had announced that since Regena had not returned her paperwork, she had been fired. This concerned Regena since she had gone to a lot of trouble to fax the medical certification form, twice, to Beltram on February 16.  Beltam denied receiving the form on February 16 when it claimed it made the decision to terminate. When the form was received by Beltram, it stated that Regena would need surgery and rehab and would be unable to work from January 28 until April 28, a period of almost 13 weeks.

Beltram sent Regena a letter explaining why she had been fired. The letter said that her doctor’s notes indicated that she was able to return to work without restrictions, on January 31, 2011, but she never did return to work.  “Additionally, you have failed to return, within the 15 calendar days granted by law, the FMLA form that was e-mailed to you on January 28, 2011.”

Tampa Court Dismisses her Case

Regena had her knee surgery on March 7, 2011. After being fired, she sought out a lawyer who filed suit for her in state court in Hillsborough County in January of 2013. Beltram removed the case to federal court and after some discovery, asked the federal court to dismiss her case entirely. District Judge James S. Moody, Jr. agreed with Beltram and found that, 1) Regena did not suffer from a serious health condition, 2) she did not give her employer proper notice of her need to take family medical leave and, 3) she had  requested more than 12 weeks of leave and thus her job was not protected.  Judge Moody therefore dismissed Regena White’s case.

But Regena appealed the District Judge’s decision to the federal Court of Appeals over Florida in Atlanta. The appeals court disagreed with the District Judge and found that Regena had presented enough evidence that she had a serious health condition. You may think that this should have been obvious to Beltram, but the District Court considered only what Beltram said they knew when they made the decision to fire Regena. The appeals court said that this was wrong and that the District Court should have considered all available evidence. “…[W]e know of no authority…suggesting that, to determine whether one had a ‘serious health condition’ a court must limit itself to considering only evidence received by the employer before the employee was fired. And we see no reason why that should be the case. The fact question-did the employee suffer from a serious health condition? – is one that, like any other question on summary judgment, should be answered using all available evidence. The appeals court explained,

“It may seem unfair to the employer, as Beltram argues, to make the serious-health-condition determination decision using evidence that the employer did not see until after the termination. But as we discuss later, other provisions protect employers from being sandbagged by employees who try to create interference claims after the fact, and based on information not known at the time of termination.”

Next, the District Court had found that Regena’s need for a leave was foreseeable, and that she had therefore not given Beltram the required 30 day notice. To reach this conclusion the District Judge seized upon the fact that Regena was told months earlier that surgery on her knee was “an option.” Then the lower court looked to her surgeon’s statement in his deposition that Regena’s knee surgery was “elective” surgery. These facts led the lower court to find her surgery and leave foreseeable and thus triggering a 30 day notice requirement for her.

Here again, however, the appeals court saw things differently. The appeals court found that the District Court had not viewed the evidence in the light most favorable to Ms. White, and this was their duty when ruling at this point in the case. The lower court did not point to Regena’s fall and re-injury of her leg on January 26. In addition, the lower court did not consider the full answer of Regena’s surgeon when he stated that her surgery was “elective.” A few minutes later in his deposition, her surgeon explained what he meant by “elective” by saying:

It’s…elective in that it does not have to be done right away in the middle of the night. That’s an orthopedic emergency. It’s a relatively urgent procedure because if it’s—something isn’t done [,] the knee is going to keep buckling out and giving out…, but it’s not a true emergency where you are going to lose your leg if it isn’t done right away.

The appeals court found that Regena’s surgery was “relatively urgent” and not a “planned medical treatment.”  Since the surgery was not foreseeable, Regena was not required to give Beltram 30 days notice.

As a last basis for dismissing Regena’s case, the District Court found that even if Regena did have a serious health condition and had given adequate notice to her employer, she was not entitled to be reinstated to her job because she had requested more than 12 weeks of leave. The District Court looked to her doctor’s statement that she would likely not be able to return until 13 weeks and found that this meant that she was not entitled to job restoration. Since she was not entitled to job restoration this meant that Beltram did not interfere with her FMLA rights when it fired her!

This raised a question that Florida employers are often presented with. If the doctor estimates they will not be able to return in 12 weeks, can we terminate? The appeals court said “No.” The WH 380 E Medical Certification asks the doctor the probable duration of the condition necessitating leave. In this case, Beltram fired her before giving her a chance to see when she would be able to return. A year later during the lawsuit, Regina went to her doctor and obtained his statement that, in fact, Regina made an excellent recovery from surgery and rehab and that she would have been able to return within 8 weeks, and not 13!  Again, the court was required to look at things from Regena’s point of view and Beltram jumped the gun and concluded she would not be able to return within 12 weeks. The appeals court found, “These competing pieces of evidence created a dispute as to whether Ms. White could have returned within 12 weeks. The District Court erred by resolving this dispute in favor of Beltram.”  With the appeals court’s reversal on these important issues, the case was sent back to the District Court and the case was tried in late February in Tampa. The jury returned a verdict for Regena in the amount of $40,700.00, less than she had asked for, but still a significant amount. Regena White vs. Beltram Edge Tool Supply, Inc., Case No. 8:13-cv-478-T-30MAP, M.D. FL (April 14, 2016).

Takeaway:

Post trial motions are still pending in this case. This past month the court awarded $40,700.00 in liquidated damages to Ms. White. The FMLA does not allow compensatory damages, but instead allows an award of liquidated damages to a successful employee. Regena’s lawyers have now also asked the court to award attorneys’ fees and costs to her as a prevailing party.  Her lawyers have spent about $140,000.00 in time (appeal and trial) and the court will review their work and decide how much to award her in attorneys’ fees and court costs. Beltram also has a pending motion to set aside the jury verdict.

This case gives many lessons. First, get the DOL forms and study and use them!! Second, take time to update your employee handbook and use and post all required notices such as the required FLMA Notice of Rights. Third, this case extends an employer’s duty to consider what happens even after it decides to fire an employee. This is a new requirement for Florida employers. Even after you fire an employee on FMLA leave, it appears you must continue to reach out to the employee to make sure that you know all the facts about their condition and ability to return to work.

Discrimination Claims

When is a Settlement Not a Settlement?

By Tom Harper, The Law and Mediation Offices of G. Thomas Harper, LLC (Tom@EmploymentLawFlorida.com)

P.F. Chang’s China Bistro, Inc.’s (“P.F. Chang’s”) received a letter from a Florida employment law firm who represented one of Chang’s current employees, a wok cook at Chang’s Sawgrass Mills restaurant .  The letter claimed that their client, Kareem Williams, who was still employed, had been the victim of harassment and discrimination. Over two months, the lawyer for P.F. Chang’s negotiated with Mr. Williams’ lawyer and reached a settlement, or so P. F. Chang’s thought.  When Kareem Williams filed suit on April 25, 2016 against P.F. Chang’s, Chang’s sued Williams back (called a countersuit) seeking to enforce the settlement agreement it had reached with Williams’ lawyer. Here is what happened.

Changing His Mind and Changing His Claims:

Kareem Williams began working for Chang’s in the fall of 2014. At the end of January this year, Williams was still working as a wok cook at Chang’s and he went to a lawyer complaining that he was a victim of harassment and discrimination. Williams hired Jeffrey Del Rio, Esq. with the Spielberger Law Group who wrote Chang’s claiming that Mr. Williams had been called names like “faggot” and the “N” word by two other kitchen employees because of his sexual orientation. William’s lawyer claimed that Kareem had reported the conduct of his co-workers to the Kitchen Manager who took no action.

During February and March of this year the lawyer for P.F. Chang’s negotiated a settlement with Williams’ lawyer, Del Rio. While these discussions were ongoing, Kareem Williams was suspended from his job. On February 29, Mr. Del Rio sent an e-mail to Chang’s lawyers stating that, “Mr. Williams indicated that if he [could] be paid for the time in which he [had] been suspended, he would be agreeable to a resolution at the $6,500 figure.” By early March the e-mails show that the lawyers agreed to settle Williams complaints by paying Williams $3,900.00 plus the scheduled time that Williams lost while suspended–$632.00. In addition, Chang’s agreed to pay Williams’ lawyers $2,600.00. The total settlement was about $7,132.00.  Williams’ lawyer agreed to the terms and Chang’s thought they had a settlement!

Chang’s lawyers prepared a written settlement agreement, had it signed by Chang’s officials and overnight mailed three (3) settlement checks with the signed agreement to Del Rio. Williams, however, refused to sign the agreement and eventually hired another lawyer who filed suit in April in federal court in south Florida claiming race discrimination.  With a new lawyer, Williams’ suit was for race discrimination-not gender discrimination or sexual harassment as claimed in the January letter.  Instead, Mr. Williams, who was born in St. Croix and is African-Caribbean by ethnicity and/or race, claimed that the line cooks at the restaurant were predominantly of African descent, while the management team at Sawgrass Mills was predominantly white. In his suit, Williams claimed that he was treated differently on account of his race and denied promotional opportunities regularly given to white employees. Williams claimed that his kitchen manager had lost his promotional test and then refused to allow Williams to re-take a proficiency test that was required by Chang’s for advancement.

Chang’s answered the suit by filing an answer denying Williams’ claims and Countersuing Williams for enforcement of the settlement agreement reached in March. P.F. Chang’s then asked the federal court in south Florida to grant its motion to enforce the settlement that Del Rio reached on behalf of his client at the time, Kareem Williams. The settlement agreement that Williams refused to sign provided that Williams released Chang’s “… from all and any claims arising from Williams’ previous employment or separation of employment with P.F. Chang’s.” Chang’s argued that the two parties reached a “meeting of the minds” on the essential terms of the settlement and that Del Rio spoke for Williams who then wrongly refused to sign the agreement. In its motion, Chang’s asked the court to find that a settlement agreement had been reached and Williams had breached the agreement by suing Chang’s. (Although three checks were sent with the agreement, and the agreement had been signed by Chang’s, there was no evidence presented that the checks were ever cashed.  In fact, the cover letter enclosing the checks stated, “Please do not cash the attorney’s fee check until you receive confirmation from Mr. Williams that he has accepted the settlement payment.”)

Court Won’t Force Settlement:

In deciding whether the settlement agreement should be enforced, the court carefully analyzed all the e-mails and communications between the lawyers. The court found that Chang’s had the burden to establish a “meeting of the minds” or mutual assent to certain and definite terms.   “While uncertainty as to an agreement to nonessential or small items will not preclude a finding of an enforceable settlement, the agreement must be sufficiently specific and mutually agreeable as to every essential element,” said the Court.

P.F. Chang’s argued that the settlement was enforceable despite Williams’ failure to sign the agreement because Williams’ lawyer had clear and unequivocal authority to enter into the agreement for Williams. The court, however, found that the hiring of a lawyer to represent a client was not enough to confer on the lawyer implied or apparent authority to compromise and settle the client’s claims. The court noted that even where the lawyer believed that he had authority to settle, that belief was not enough.  By its research the court found that in Florida cases, the courts “…have been very stringent in what they find to be a ‘clear and unequivocal’ grant of authority,” to the lawyer. After studying all the correspondence over the settlement negotiations, the court believed that the correspondence did not show that Mr. Del Rio had “clear and unequivocal” authority to enter into the settlement agreement. As a further basis for finding that Chang’s had not met their burden of proof, the court also looked to the fact that Chang’s had twice asked Del Rio to have Williams sign the agreement. The court concluded that the parties thought that Williams’ signature was necessary to complete the settlement. Kareem Williams v. P.F. CHANG’S CHINA BISTRO, INC., Case No. 16-cv-60906, (S.D. Fla, August 16, 2016).

Takeaway: Here in Florida, courts are hesitant to “force” a settlement upon a party, even when all the terms have been agreed upon by lawyers representing the respective sides. Your editor had a three (3) day evidentiary hearing in Tampa a few years ago in a similar case with facts even more favorable for the employer. In that case also, the former employee refused to sign the final agreement and fired his lawyers. The lesson learned is that, until the (former) employee signs, you likely do not have a settlement.