Federal investigation accuses St. Pete's Red Mesa restaurants of withholding employee wages

Federal investigators with the U.S. Department of Labor are accusing two Red Mesa restaurants in St. Petersburg of withholding wages from employees, a violation of the Fair Labor Standards Act.

Back in 2021, investigators with the Wage and Hour Division conducted an investigation of Red Mesa Restaurant and Red Mesa Cantina, and claim the ownership and managers at both establishments withheld earnings from employees in an effort to recover costs of customers who skipped out on their bills.

Employees lost between $10-$175 per day, say investigators.

The Mexican fusion restaurants are also accused of illegally deducting uniforms from employee paychecks, and denying workers overtime by not allowing employees to combine hours when working at both locations.

Red Mesa Restaurant (located at 4912 4th St. N) and Red Mesa Cantina  (128 3rd St. S) are both owned by Peter Veytia, though the cantina is operated under a separate corporate name, Veytia Ventures LLC.

“By law, two or more establishments that are commonly owned are considered a single enterprise," said Wage and Hour District Director Nicolas Ratmiroff in a news release. "In this case, the employer assigned employees to work at two locations they owned. They should have added the hours worked at these locations together and paid overtime when the combined hours exceeded 40 hours in the same workweek. Operating restaurants with the same owners under different corporate names does not remove that liability."

The investigation also accused the restaurants of not properly keeping payroll records, and failing to allow kitchen workers to acquire overtime by paying them a "straight time regardless of how many hours they worked."

“We were very distressed to learn about these wage and hour violations two years ago," said a spokesperson for Red Mesa. "Since then, we’ve paid our employees double what they were owed to make things right. And we’re taking far- reaching steps to make sure something like this never happens again.”

So far, federal investigators have recovered $190,730 in back wages and liquidated damages for 89 affected workers.

Veytia's other venture, Red Mesa Mercado, was not named in the investigation.