Protest Planned Against Southeast Michigan Restaurant Group Following Lawsuit Against Former Employees #DetroitFood

Diamond’s in Howell. | Diamond’s Steak and Seafood [Courtesy photo]

Former workers are involved in a legal dispute with Adam Merkel Restaurants in Howell over disagreement about returning to work during the pandemic

Protesters are organizing a demonstration against southeast Michigan restaurant group Adam Merkel Restaurants, after the company filed a lawsuit against four former employees for speaking out against the business.

Adam Merkel, of Adam Merkel Restaurants, owns multiple establishments in Howell and Royal Oak, including the Silver Pig, Cello Italian Restaurant, Diamonds Steak and Seafood, and Pinky’s Rooftop. The defendants in the case brought by the restaurant company include past and present employees at the Howell properties, who spoke out against the company on social media, alleging that the restaurant group used intimidation tactics to get employees to return to work during the pandemic. All four defendants no longer work for the company.

The lawsuit alleges that former restaurant workers Kristen Kraft, Brianna Swayze, Jessica Jeffrey-Friar, and Nicholas Griffin posted “false and defamatory statements” to Facebook that caused financial losses to Merkel’s businesses, according to the Livingston Daily. He is seeking $25,000 in damages. The four defendants confirmed to Eater in a statement that only one person, Brianna Swayze, has officially been served.

In an interview with Eater, Merkel stated that the online accusations were having a severe financial impact on the group’s restaurants and an emotional impact on the employees who work there. “We don’t want any money,” he says. “We just want them to stop saying things that are untrue about our people and the company.”

The dispute is an example of the difficult positions restaurant owners and employees are being placed in during the pandemic, an existential threat to people’s health that’s also having severe consequences for the economy.

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In May, Merkel’s restaurant group faced social media backlash after Kraft and Swayze made Facebook posts critical of management’s decision to fire them for refusing to return to work during the novel coronavirus pandemic. According to a report by the Livingston Daily last month, employees at the restaurant group were laid off on March 16 due to Michigan’s COVID-19-related dine-in closure. Then, on April 23, the company sent out messages to employees through a scheduling app telling them to return to work on April 27; if employees did not respond within 24 hours, the company would consider it a refusal to accept their job back, according to screenshots of the message provided to Eater. Refusal to accept a job could potentially jeopardize a worker’s unemployment benefits. Management for Adam Merkel Restaurants maintained that it was necessary to bring employees back to work during the pandemic to satisfy the terms of a Paycheck Protection Program loan, which during its original rollout required that a certain number of employees be retained on payroll.

Merkel told Eater that the restaurant group was among the first in the state to receive a PPP loan during the rollout of the program. However, the terms and language surrounding those loans and the requirements from the CARES Act were murky to many restaurateurs early on. Only recently did businesses who received the loans get some relief in the form of deadline extensions for paying the money back and clarity on the process. Merkel says he and his managers met over Zoom roughly six times to discuss the PPP loan and how to handle asking workers to come back. Merkel stated that the April 23 scheduling app message went out a week after the company had reached out to employees individually to discuss returning to work.

The language of the message was not “perceived not the way we intended,” Merkel says, noting that some of the wording was lifted from legal wording to make sure employees were aware that a refusal of recall might negatively impact their unemployment benefits. “We we were trying to figure out ‘How do we communicate to everyone?’ because with the PPP thing you had to document who came back who didn’t,” Merkel says. “We let everyone know we were fine with anyone coming back at a later date, but it could affect your unemployment too.”

Merkel says the restaurant received very few responses to the first message and then sent out a second one the following day, explaining more of the nuances of the PPP loan and the safety measures the restaurant was taking. Merkel says the restaurant gave only 24 hours to respond to the first message because management was trying to create a new work schedule in time for the reopening of carryout operations. Merkel provided copies of the letters; however, they don’t include specific post dates. Merkel says that somewhere between 60 and 70 percent of laid-off employees returned to work.

Swayze, a former employee at Diamonds in Howell, expressed discomfort with coming back to work because working at a restaurant in close proximity to other employees and the public could put her family members, including her brother, who is immunocompromised, at greater risk for contracting COVID-19, according to the Livingston Daily’s report. Swayze declined to grant an interview to Eater due to the pending litigation.

Jessica Jeffrey, a former bartender at Cello who left the company in 2018, made a post to her personal Facebook account on April 26 calling for a boycott of Merkel’s Howell restaurants. In the post, Jeffrey alleged that the restaurant group sent out “intimidating messages” about returning to work and firing employees who objected to returning. She also claimed that the group required employees to supply their own personal protective equipment. Shortly after, commenters began adding their own allegations about experiences with the restaurant group.

Since then, other allegations have emerged on social media, including claims of sexual misconduct being perpetrated by a current employee. “When we heard that, we were alarmed,” Merkel says. “That’s the first time we’ve ever had anything like that brought up to us.” Merkel stated that he placed the employee in question on leave when the allegations emerged and called the police. Police then investigated and interviewed kitchen staff who were in the restaurant on the alleged date of the incident. Eater was able to review the report, which included an allegation of fourth-degree forcible contact. Charges against the alleged perpetrator were denied due to a lack of evidence, and the employee was permitted to return to work.

Kraft, a bar manager at Cello and an occasional employee at Diamonds in Howell, expressed similar reservations about returning to work in the kitchen where she was previously a bartender and shared concerns about going back during the stay-at-home order.

According to screenshots of correspondence provided to Eater, Kraft was removed from employee scheduling apps and other employee communications on April 26. Despite requests for a formal termination letter, she didn’t receive that documentation until after she posted her concerns on social media. She then received a cease-and-desist letter via email from an attorney representing the company. The email confirmed her termination from the company and demanded she delete the post and stay off the premises at all Adam Merkel restaurants.

“We knew it was a tough time. It’s not like one of those things where you’re going to make everyone happy,” Merkel says. “We just didn’t want them to say things that weren’t true.” After unsuccessfully attempting to get the former employees to remove their posts, Merkel said he reached out to lawyers to send the cease-and-desist letter. “It just got way out of control,” he says of the social media backlash. “We had employees coming in and tears every other day.” Merkel says that employees and customers who tried to defend the restaurant group in threads had their comments deleted. Merkel says he understood why the claims gained so much attention. “I would read that and be concerned if I thought that was true.”

Merkel says business was initially busy when his Howell restaurants reopened for takeout, but that it declined following the social media posts. He held a manager meeting and asked how they wanted to handle the issue, and staff was “unanimous” in the opinion that legal action needed to be taken.

Nicholas Griffin was also named as a defendant, despite not having worked for the restaurant group in roughly two years. Griffin worked at Diamonds as a bartender for just over two years and left on good terms to work for a different business. The lawsuit points to a statement made by Griffin referring to an alleged investigation of the restaurant claiming tip theft. A screenshot provided to Eater of conversations between former employees alludes to investigation and possible settlement.

Eater submitted a request to the state for information on wage investigations involving restaurants associated with Adam Merkel. Documents provided by the state showed two investigations from 2013 conducted on behalf of former employees at Diamonds Steak & Seafood resulting in payments of back wages between $400 and $2,000. Merkel became a full owner of the restaurant group in fall of 2013. Eater did not receive any specific documentation of a complaint for the estimated dates provided by Griffin. Eater found documents for two cases filed by former employees at Diamonds and Pinky’s, both of which were dismissed after an investigation by the Wages and Hours Division.

Merkel stated that a labor audit of the former Diamonds (now the site of Cello) took place sometime around 2016, and the state found that a tip pool in the restaurant wasn’t in compliance with state rules. The tip pool was designed to spread tips between front-of-house employees and kitchen staff. Under the law, the kitchen staff could not be part of the tip pool. Merkel says tipped employees were given checks for back pay based on the tip pool, and kitchen staff were allowed to keep the money they received during the time the pool took place.

Kraft started a legal defense fund on Saturday, June 6, to raise $5,000 to help the four employees fight the lawsuit. So far, they have raised more than $4,000. The group has also begun working with Michelle Merrigan, a community member who is now acting as a spokesperson for the defendants in the lawsuit.

Organizers of the protest plan to meet at 6 p.m. in front of Howell City Hall on Sunday, June 28, to distribute signs and masks. The group plans to hold a demonstration in downtown Howell between 6 p.m. and 8 p.m. Swayze is expected to file a countersuit soon, according to a representative for the defendants in the lawsuit.

Eater is tracking the impact of the novel coronavirus on the local food industry. Have a story to share? Reach out at detroit@eater.com.

• Firing of Howell Bartenders During COVID-19 Outbreak Sparks Social Media Backlash [Livingston Daily]
• Adam Merkel Sues Four Former Employees for Defamation [Livingston Daily]
• All Coronavirus Coverage [E]

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