Restaurants Must Fork Over Service Fees

Law360, New York (February 15, 2008, 12:00 AM EST) -- In a potential blow to the New York restaurant industry, the state's highest court has ruled that dining establishments must hand over any obligatory service fees to waiters that customers are tricked into believing are interchangeable with leaving a tip.

The New York State Court of Appeals ruled on Thursday in favor of the servers of World Yacht Inc. , reversing an earlier decision that found employers were not required to share mandatory service fees tacked onto the bills of large parties even if customers were...
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