Ann Arbor Restaurant Operator Agrees to Pay $197K in Back Wages

The company shorted wages, yet accepted a more than $942,000 federal loan.

The U.S. Department of Labor
The U.S. Department of Labor building.
The U.S. Department of Labor building.

ANN ARBOR, Mich. – An Ann Arbor restaurant operator who sought and received nearly $950,000 in federal assistance to help keep workers employed during the pandemic has agreed to pay $196,531 in back wages and liquidated damages to 20 employees after a U.S. Department of Labor investigation into the employer’s illegal pay practices.

A consent order and judgment entered June 14, 2024, by the U.S. District Court for the Eastern District of Michigan, resolves allegations made by the department against Adam Baru, owner of Cascabel Ventures, in a September 2023 lawsuit to recover back wages and liquidated damages and obtain an injunction against Baru and his restaurants to prevent future violations of the Fair Labor Standards Act.

An investigation by the department’s Wage and Hour Division found that — from Sept. 21, 2020, to July 3, 2022 — Baru as joint operator of Isalita and Mani Osteria & Bar failed to pay workers overtime at time and one-half their regular rate of pay for hours over 40 in a workweek.

During litigation, Baru admitted to accepting a loan from the U.S. Small Business Administration’s Paycheck Protection Program; public records indicate the two restaurants received $942,736 in February 2021. The restaurants’ owner also told the court he created a payment system that did not combine hours employees worked at both restaurants to ease the company’s financial burden during the pandemic and keep his businesses open and his employees working. The division determined that, despite benefiting from the PPP loan, Baru did not begin paying overtime properly until the division’s investigation began.

As part of the consent order, Baru and Cascabel Ventures have also agreed to pay $10,069 in civil money penalties assessed by the department. The court also granted the department’s request for an injunction forbidding the employer from future violations.

Attorney Sheila Naughton in the department’s Regional Office of the Solicitor in Chicago litigated the case.

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