Michael Mina reaches settlement after overcharging customers at his SF restaurants

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Celebrity Chef Michael Mina is among the SF restaurateurs who charge customers for his employee health care obligations.

Celebrity Chef Michael Mina and his four San Francisco restaurants – Michael Mina, RN74, Bourbon Steak, and Clock Bar – have agreed to pay $83,617 to their employees to settle charges of overbilling their customers a 4 percent meal surcharge ostensibly intended to cover the company's employee health care obligations.

As I reported last week, City Attorney Dennis Herrera is investigating fraudulent use of surcharges by restaurants, and its settlement with Mina Group LLC was the first of what could be dozens with local restaurants to come clean under Herrera's partial amnesty offer. The company was the city's worst violator, according to filings last year with the city's Office of Labor Standards Enforcement, which showed the company collected $539,806 in surcharges and spent just $211,809 on employee health care.

A spokesperson for Mina Group had told the Guardian that a settlement was in the offing and that the company would forward it to us as soon as it was available. Instead, the company leaked the settlement to SFgate.com's Inside Scoop restaurant column, which posted a story about it on Friday evening, the dead spot in the weekly news cycle.

Mina told Inside Scoop that all the surcharges it collected are being held in a fund for employee health care and the company has lowered its surcharges from 4 to 3 percent to correct the overcharging. San Francisco's restaurant industry – which waged an aggressive legal battle against the employer health care mandate – is the only industry to use explicit customer surcharges to cover its obligations under city law.

The full joint statement by the City Attorney's Office and Mina Group follows:

“The City Attorney’s Office and Mina Group announce a settlement regarding surcharges imposed in response to San Francisco’s Health Care Security Ordinance. The settlement terms have been guided in part by findings in which the City Attorney’s Office acknowledges that Mina Group’s employee health care program reflects some best practices in administration of health care surcharge funds.

“Mina Group and its affiliates collected surcharges during 2009 – 2011, as previously reported to the Office of Labor Standards Enforcement (OLSE). The City recognizes that 100 percent of the surcharges collected will continue to be used exclusively for employee healthcare and that the majority has already been used. Under the settlement agreement, Mina Group will contribute $83,617.50 of remaining surcharges to eligible persons who were employees during that period.

“The City Attorney’s Office reaches no conclusions on liability in successfully concluding its enforcement action with Mina Group and its affiliates. Mina Group will continue to fully support the San Francisco Health Care Security Ordinance.”

Comments

allowed employers and employees to work out their own pay, benefits and conditions.

I will continue to reduce my tips by 4% as a protest against the city's invasive and inflationary interference.

Posted by Guest on Apr. 29, 2013 @ 10:31 am

How does tipping the server less affect the city in any way? They have to live off that money. Just admit you're cheap, and probably tip poorly to begin with

Posted by Guest on Apr. 29, 2013 @ 12:37 pm

Seriously. You're doing it wrong. Reducing your tip is absolutely the wrong way to protest this.

Posted by Guest on Apr. 29, 2013 @ 2:12 pm

The whole tipping that at a restaurant like Mina's is sort of strange. You go out for dinner and the base charge is $170 for 2 people. And on that doesn't include the salary of the people who take your order, cook the food and wash the dishes??

The 4% thing is a typical Progressive clusterf*ck. Poorly thought out. Are the health costs of the staff at Mina's 3x that of the staff at the hamburger places where the bills are so much smaller? That was probably the basis of this problem. The hamburger joint probably needs to charge 4%, high end places should probably have used something lower based on their higher bills.

Posted by Troll on Apr. 29, 2013 @ 2:52 pm

Don't blame the surcharges on progressives -- they are the invention of conservative restaurateurs who were bitter about losing their long court fight against the city challenging the HCSO. Most businesses in San Francisco absorbed the cost of providing employee health care without using these petulant and self-serving surcharges, let alone using them in the fraudulent way that Mina Group did. It's shameful by itself, and when they use language in these surcharges to make it sound to customers like they're doing something special for the employees, that's just shameless.

Posted by steven on Apr. 29, 2013 @ 3:40 pm

When you describe this Mina Group as "using these petulant and self-serving surcharges, let alone using them in the fraudulent way that Mina Group did. It's shameful by itself..." are you really that surprised that they didn't call you back to provide you with information about the settlement and instead sent it to the Chron?

Posted by The Commish on Apr. 30, 2013 @ 6:53 am

Two points: One, I made that statement long after the company broke its promise to send me the info.

Two, I won't temper what I write to ingratiate myself to sources, as many other reporters in town do, which is why accountability journalism is so weak in publications like the Chronicle. I expect public figures to be accountable to the public and to the Guardian readers that I represent. So I'll be polite and diplomatic in dealing directly with sources (or confrontational when called for), but I'll always call it like I see it in print.

Posted by steven on Apr. 30, 2013 @ 10:17 am

getting caught defrauding both their patrons and their employees at the same time while subjecting their diners to unwanted proselytizing as a "typical Progressive clusterf*ck."

How about Troll's rhetoric? Now *that* qualifies.

Posted by lillipublicans on Apr. 29, 2013 @ 3:44 pm

That's simply wrong in every way. Why on earth would you hurt the person that is working hard to give you a great experience dining?? Stop being so lazy, and instead, contact your council person.

Posted by Guest on Apr. 29, 2013 @ 5:44 pm

I still tip 20%. I just piss on the floor of the bathroom and never return.

Posted by Guest on Apr. 29, 2013 @ 10:32 am

The blame clearly lies with the city and it's interventionist meddling that ahs set diners against waiters.

So, I tip 15% - 11% to the waiter and 4% to his health fund. He/she is no worse off than before this law passed. Nor am I and nor is the restaurant.

It's the only solution where nobody loses.

Posted by Guest on Apr. 29, 2013 @ 11:19 am

Greedy, stupid, and undemocratic -- the right-wing trifecta

Posted by steven on Apr. 29, 2013 @ 3:42 pm

Naive, stupid, undemocratic. The progressive trifecta.

Posted by Guest on Apr. 29, 2013 @ 4:51 pm

I personally would combine naive and stupid into one flaw and add ineffective. Because that is the single most important characteristic of the San Francisco Progressives.

Do you notice that you aren't getting any updates about the Shell renewable energy plan?

Avalos is too busy asking the pension fund to pull all investments from Shell and all the other fossil fuel companies that he uses every day. But it sounds great and makes everyone feel good.

Posted by Troll on Apr. 29, 2013 @ 5:31 pm

The "ineffective" progressives passed semi-mandatory health insurance coverage for many SF employees, and you reactionary commenters can't stop complaining about it.

And the cheapest shits among you swallow the restauranteur's propagandized "surcharge" line item and stiff the servers. I dare you to mention your 4% reduction in tips when you order your food.

Posted by Guest on Apr. 29, 2013 @ 8:03 pm

Who do you think cleans the bathroom, the owner - or maybe the corporate shareholders? That just makes the life of janitor worse.

Posted by Guest on Apr. 30, 2013 @ 1:01 pm

I posted a comment to that effect when it first showed up.

Nobody who cared about restaurant workers' heath would pee on a floor to demonstrate their displeasure with a restaurateur's policy; that's precisely the sort of nasty behavior that vindictive righties would think of.

Posted by lillipublicans on Apr. 30, 2013 @ 1:25 pm

Wait....the Mina restaurants have been overcharging their customers?

Who says that there is no big news in these columns.

Posted by Guest on Apr. 29, 2013 @ 10:46 am

How did you miss that? It's right there in the lede. But I guess like most illiterates, you never read past the headline. If you did, you'd figure out that these scumbag restaurant owners are breaking the law by pocketing money that doesn't belong to them. It's called stealing.

Posted by Guest on Apr. 29, 2013 @ 11:17 am

seems fair that they would practice the same kind of civil obedience that the SFBG is always advocating.

As a customer, I will stop short of refusing to pay the surcharge, although that is certainly an option.

But I will tip less as the wait staff are now getting something for nothing.

Posted by Guest on Apr. 29, 2013 @ 11:21 am

minimum wage; over-time pay; family leave act; just totally unfair and such a burden to do business.

Posted by Michael W on Apr. 29, 2013 @ 12:02 pm

If you do actually read anything you would know that the restaurants are not "screwing their workers out of their health care". The health care was were there, the restaurants just collected more than what was needed to fund the it. Read this article. Mina will now charge 3% instead of 4% because that is closer to the actual need.

But hey...if you get a chance to throw a tantrum and it makes you feel good to do so...then why not? Easier than actually learning anything.

Posted by Guest on Apr. 29, 2013 @ 11:59 am

got in early again with a couple of droppings under the "Guest" id.

Anyhow, it sounds like the restaurateur was able to secure a bit of face-saving in this negotiation process with the CA; basically had to cough up all the money and set up his program as a true representation of what the law was supposed to have resulted in right from the start. Is that it?

Posted by lillipublicans on Apr. 29, 2013 @ 10:50 am

Charged: $539,806
Spent: $211,809

so they ended up $327,997 in the black.
Pay a penalty of $83,617

Still make out with $244,380.

Now I get it that there is value in the CA not having to pursue these guys and could've ended up with squat, but really, over a quarter of a million bucks pocketed?

Maybe I'm missing something here?

Posted by GuestD on Apr. 29, 2013 @ 1:02 pm

A quarter of million dollars pocketed?

Hererra doesn't seem to have gone overboard in polishing his image.

Posted by lillipublicans on Apr. 29, 2013 @ 1:17 pm

That's a good question, and an issue that I'm still waiting to discuss with the City Attorney's Office, which has said it wouldn't comment on this case beyond the settlement message. But I'm very curious about the criteria used to make these settlements, particularly given that we'll be seeing many more of them in the coming weeks.

Now, I understand the Mina Group's claim that it spent more than $211,000 since those figures came out (new data is due to the OLSE on April 30), and that there is still surcharge money in these health savings accounts to be used by employees, hence the $83,000 settlement. But I also want to know more about the criteria being used, and I'll report what I find out in future stories.

Posted by steven on Apr. 29, 2013 @ 3:52 pm

Jason Grant Garza here ... while on the SUBJECT of HEALTH CARE why NOT ask HERRERA about federal case (C02-3485PJH) where the city lied and committed fraud to have my MEDICAL LAWSUIT thrown out in 2003 ONLY to sign a "CONFESSION" in 2007 http://myownprivateguantanamo.com/settle1.html ADMITTING fault and guilt then LEAVING its INNOCENT VINDICATED VICTIM for DEAD. It 2013 and NO ONE from the city attorney, COURTS, DPH or SF General has EXPLAINED.

You might also want to ask about the "CRIMINAL FRAUD" by DPH for a BOGUS restraining order https://www.youtube.com/watch?v=7cP3jCmJFRo&list=TLJIxyBOOUvk-xzv2orPQxd... .

RIGGED is as RIGGED DOES. Oh and watch the TREATMENT I get at Mr. Herrera's office following up (remember the patient dumping, chest thumping BS over Nevada's patient dumping) ... watch the videos on youtube.

Now note ... I am SURE that the settlement mentioned in the article INCLUDES NO fault or admission of guilt ; however, MINE did and what was the CONSEQUENCE? It is 2013 and STILL NO ONE ENFORCES medical law ... see videos on YOUTUBE.

Keep DRINKING the KOOL-AID ...

Posted by Jason Grant Garza on Nov. 19, 2013 @ 1:50 pm

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