AUSTIN (KXAN) — The U.S. Department of Labor recovered more than $230,000 in back wages for employees of a Central Texas barbecue chain after an investigation into illegal tip sharing.

The Department of Labor recovered $230,353 in back wages for 274 workers employed by Black’s Barbecue after an investigation found the employer gave a portion of employee tips to restaurant managers. That practice is not allowed by federal law.

Investigators with the department’s Wage and Hour Division found Black’s Barbecue Inc., Kent Black’s Lockhart Barbecue Inc. and New Braunfels Barbecue LLC each followed the illegal tip-sharing practice.

The Fair Labor Standards Act prohibits employers, managers and supervisors from keeping tips the business’ employees receive for any purposes, whether or not the employer takes a tip credit.

“Food service industry employers must know that tips are the property of tipped employees who earn them, plain and simple,” explained Wage and Hour Division District Director Nicole Sellers in Austin. “Workers and their families depend on their rightfully earned wages and benefits. If you take from them, you take from their families. The Wage and Hour Division is committed to safeguarding the rights of all essential food service workers.”

Black’s Barbecue Inc. and Kent Black’s Lockhart Barbecue Inc. has operated for three generations in Texas. In addition to Lockhart, the employer has locations in Austin, New Braunfels and San Marcos.

Black’s Barbecue sent KXAN the following statement in response to the DOL’s press release:

Black’s Barbecue has always paid 100% of all tips to all of their employees based on current laws and rules. The company and the owners of the company have never received any tips.

Black’s BBQ was not aware that Department of Labor (DOL) rules had recently changed in 2020 and that managers should not receive tips.

Our payroll has always been outsourced and we relied on the HR company for advice. When notified of the rule change, we quickly and voluntarily came into compliance with DOL.

All hourly employees, both current and former were fully compensated for everything they were owed with company funds. This issue was resolved with DOL in 2021.

Kent Black, owner of Black’s Barbecue

The division identified nearly $35 million in back wages owed to more than 29,000 food service industry workers in fiscal year 2021. The division commonly finds violations related to employers retaining tips, failing to pay overtime when required, and not paying for pre- and post-shift work, according to a press release from the division.

Learn more about the Wage and Hour Division, including a search tool to use if you think you may be owed back wages. Workers can call the Wage and Hour Division regardless of immigration status. The service is free, confidential and the department can speak with callers in more than 200 languages.