(NewsNation) — A lawsuit has been filed against three Denny’s workers in Canada accusing them of embezzling $500,000 in tips.
Northland Properties Corporation, the hospitality group behind Denny’s in Canada, revealed a recent audit found $11,000 had been illicitly moved from the restaurant’s electronic tip system in a scheme involving two employees, according to the lawsuit. The claim adds a third employee allegedly inspired the two employees after the third employee stole nearly $495,000.
“At all material times, the defendants owed the plaintiff duties of honesty, fidelity, confidentiality, and lawful use of employer property and systems,” the lawsuit states. “The defendants breached those duties.”
The lawsuit adds Denny’s “maintains a digital tip distribution platform known as Tips Today, used to collect, hold, and distribute funds to employees.”
A former employee of the chain acknowledged cash tips from diners went directly to servers. They added credit card or debit card tips went into the online system and servers would receive a kind of credit card with the tips owed to them on the card.
Northland Properties Corporation says it is seeking damages for breach of contract, breach of fiduciary obligations, theft, civil fraud and conversion.