Texas' iconic Black's BBQ chain illegally let managers keep $230,000 in worker tips, feds say

The U.S. Department of Labor has ordered a revered restaurant chain that bills itself as the state's "oldest BBQ joint" to pay $230,353 in back wages over accusations that it shared employees' tips with managers in violation of federal law.

The order affects 274 workers at the Black's Barbecue chain, according to the Labor Department. In addition to its flagship store in Lockhart, the 90-year-old business operates spots in Austin, New Braunfels and San Marcos.

The federal Fair Labor Standards Act bars businesses and their managers from keeping tips given to employees for any purpose.

“Food service industry employers must know that tips are the property of tipped employees who earn them, plain and simple,” said Wage and Hour Division District Director Nicole Sellers said in an online statement. “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.”

Kent Black, owner of the barbecue chain, said the violation was a result of an error by an outside bookkeeping contractor and that he resolved the matter with the Labor Department last year. Black said the bookkeeper is no longer doing business with the company.

"We quickly resolved it and felt terrible about it," Black said. "We love our employees, so it was a real gut-punch to me personally that the company we hired to do payroll missed that."

While the company mistakenly paid tips to managers in violation of a 2020 rule change, Black said the business and its owners have never  taken tip money.

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