Several D.C. restaurant owners have recently been slapped with steep fines over alleged wage theft in what the industry sees as a surprise move by the city’s Department of Employment Services.

The local restaurant trade group says these fines are unprecedented; DOES disputes that characterization. But nonetheless, the agency is already facing pushback from the restaurant industry and at least one D.C. councilmember.

The reason? Some restaurants are being charged heavy penalties for minor discrepancies or even administrative errors.

One restaurant’s notice says it should owe $108,400 for allegedly failing to pay two employees a total of $1.85 — one employee is owed $1.40 after accounting for tips and another 45 cents — between April 2020 and June 2020. The agency reduced the penalty to $6,000 because its investigation process was delayed at no fault to the business, according to the DOES notice dated June 20 and shared with DCist/WAMU.

Still, the restaurant has to pay $6,000 by July 20 for failing to adhere to the city’s full minimum wage law, per the notice. The restaurant declined to be interviewed for fear of retaliation from the city for speaking with the press.

In another instance, Cyrille Brenac of La Piquette and Bistrot Lepic & Wine Bar received enforcement notices in June that he is still trying to resolve. The paperwork says the restaurants owe several tipped employees hundreds or even thousands of dollars each, according to the June 13 and June 27 notices shared with DCist/WAMU. The discrepancy appears to be related to the fact that the notices state the employees’ hourly wages are $445 or $500, evidently an administrative error. Brenac says his workers’ reported hours were multiplied by 10 in the notices and their hourly rates by 100.

The error in 2020 payroll data resulted in a heavy fine — La Piquette and Bistrot Lepic now owe the city $24,000, itself a significant reduction from the original penalty, once again because the DOES investigative process was delayed.

“When I first received one I almost had a heart attack,” he says, given the charges. He says he never received enforcement notices like this before and his tipped workers earn well above minimum wage.

Brenac has contacted DOES on multiple occasions since receiving the notices, trying to correct the record and clear the charges, he tells DCist/WAMU. He says he also shared payroll information from his provider Paychex, showing the correct hours and rates for each employee.

DOES has spent two weeks investigating, he says, but with the deadline to pay the penalties fast approaching, Brenac just requested a formal hearing with D.C.’s Office of Administrative Hearings to settle the dispute. He is now in the process of securing a lawyer, he says.

He’s more bothered by the time it’s taken to resolve the problem than the notices themselves, he says.

“This is a waste of time,” says Brenac. “We are bearing the weight of this mistake.”

The Restaurant Association Metropolitan Washington, which represents hundreds of local restaurants, says it has heard from at least eight operators who’ve received questionable notices, but suspects more businesses have been impacted. RAMW President Shawn Townsend says he is not aware of DOES ever sending enforcement notices like this before.

Townsend also says he reached out to DOES Director Unique Morris-Hughes soon after he learned of the fines, and that she and her team are looking into the situation.

“She clearly understands the environment right now that restaurants are in,” Townsend says. “She is clearly sympathetic to that and wants to work it out.” A DOES spokesperson declined to confirm the conversation or say how many bars and restaurants received notices, citing “pending matters.”

The spokesperson also clarified that bars and restaurants are required to submit wage data to DOES to confirm compliance with labor laws. “When noncompliance is found, DOES notifies the entity of the alleged violation and the statutory process for resolution of the matter,” the spokesperson says via email. “It is not a new process.”

DOES did not respond to a question about why restaurants are just receiving notices now for alleged violations from 2020.

Employers of tipped workers have been required to report certain wage data to DOES since 2018. That’s when the D.C. Council passed a bill requiring it as a compromise to repealing Initiative 77, which would have phased out the tipped minimum wage. Lawmakers wanted the government to be able to go after wage theft, which Initiative 77 advocates argued is pervasive under the current two-tiered wage system. (D.C. voters ended up passing a nearly identical ballot measure, Initiative 82, this past November.)

But few bars and restaurants have actually reported wage data to DOES in recent years, according to a recent report from worker advocacy groups D.C. Jobs With Justice and the Restaurant Opportunity ​Center of D.C. That analysis found that only 11% of D.C. restaurants with a liquor license reported wages quarterly to DOES between April 2021 and March 2022.

RAMW pushed back on this report, saying the District did not make it easy for businesses to report by failing to create a portal promised in the law.

A follow-up report from the groups, which reviewed thousands of wage filings obtained through a Freedom of Information Act request, concluded that DOES must not do enough to penalize the restaurants that failed to comply with wage laws, because many restaurants did so repeatedly.

Whatever happened in the past, the agency’s enforcement of the law now is being done in a manner that both RAMW and Ward 6 Councilmember Charles Allen take issue with. Allen wrote the DOES director on Thursday saying as much.

“I am fully supportive of ensuring workers receive every penny they are owed from their employers, but a plain reading of these notices and fines can only conclude this is a blatant abuse of the agency’s discretion and runs counter to the spirit of our minimum wage laws,” Allen says in his letter.

He says he learned of two restaurants in his ward that have been notified of penalties between $100,000 and $220,000. One was fined for an underpayment of $1.85 and another for $3.

“In my view, the agency’s action reinforces the perception that the District is a challenging place to do business and breeds distrust in government and contempt for our important labor protections. Having seen these notices myself, I find that hard to argue with,” he wrote.

It remains unclear whether restaurants will have to pay the steep fines for the minor infractions or administrative errors — and if so, whether they’ll be able to.