Mario Batali agrees to pay $5.25 million settlement in tip-skimming controversy

This time around, Batali's not making dough -- he's coughing it up.

The news that Mario Batali agreed to fork over $5.25 million to his servers after being sued over alleged tip skimming is serving as a cautionary tale for some of the city's biggest restaurant owners.


The case was filed in 2010 by a waitress at Batali's famed Village spot Babbo. In the filing, she and others accused Batali of improperly deducting up to 5 percent of total wine sales at the end of each night from the tip pool, according to the New York Times. Instead of doling the cash out to employees, the restaurant kept it, the suit alleges.


Batali and his business partners agreed to settle, according to court papers out today.


Many restaurants in the city pool tips, said James DiPasquale, an attorney who represents restaurants and nightclubs, but he cautioned that the key is to keep careful records – even without a lawsuit, restaurants can be penalized by the Department of Labor.


Restaurants “have been pretty heavily targeted with these very similar wage and tips lawsuits,” DiPasquale said. "Everyone's getting targeted."

“This is a reminder for those restaurant owners that own 5, 6, 7 restaurants,” he said. “They have to be careful, because even in the absence of a lawsuit, any employee that files a claim with the Department of Labor, that’s when things can get scary.”

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