Oregon's Bureau of Labor and Industries said Wednesday it will investigate wage claims totaling more than $21,000 by 28 employees of three Si Casa Flores restaurants in Jackson County that closed in mid-September.
Two Mexican food restaurants in Medford and one in Phoenix were operated by Gregorio Martinez Rodriguez, who filed for Chapter 11 court protection in the U.S. Bankruptcy Court District of Oregon on March 24, 2015. No reorganization plan was filed over the next 30 months, and presiding Judge Thomas M. Renn converted the bankruptcy to Chapter 7 liquidation Sept. 15.
BOLI may direct up to $4,000 per worker through the state’s Wage Security Fund for wages earned 60 days before a closure. Wage and hour compliance specialists will determine and verify how much is owed each worker. The fund covers only wages.
“Workers who do not receive a final paycheck when a business shuts its doors still have expenses and bills to pay,” State Labor Commissioner Brad Avakian said in a statement.
In 2011, three Si Casa Flores employees filed sexual harassment suits against Rodriguez and restaurant manager Juan Flores. In July 2012, a U.S. District Court jury found Leo Esquivel’s civil rights had been violated when the owners created a hostile work environment by subjecting Esquivel to unwanted sexual conduct in the workplace, battery and intentional infliction of emotional distress.
The court awarded Esquivel $200,000. Subsequent out-of-court settlements were reached with restaurant employees Francisco Flores and Eduardo Lopez. After $100,000 of the original judgment was paid to Esquivel, the remaining settlement was to be made in installments. But Esquivel received no further payments, and Flores and Lopez received nothing. Bankruptcy court filings showed that a collective $500,000 remains unpaid.
Lawyer Bob Robertson, who represented the employees, said Rodriguez continues to fight the judgments in federal court.
"I'm wondering why there is money to pay lawyers, but not to pay all those employees," Robertson said. "It's a tragedy."
The agency encouraged employees who have yet to be paid to contact the agency’s Wage and Hour Division. Workers can file wage claims with BOLI by contacting the agency at 971-673-0844 or emailing firstname.lastname@example.org.
Three cents per $100 of the state’s employment tax paid by employers for one quarter every odd-numbered year go into the fund. After BOLI distributes payments, the agency seeks to recover the wages owed from the business or its successor.
Oregon is one of two states in the country to have such a fund.
— Reach reporter Greg Stiles at 541-776-4463 or email@example.com. Follow him on Twitter at www.twitter.com/GregMTBusiness or https://www.facebook.com/greg.stiles.31.