Irvine Restaurant Fined $300,000 Over Labor Violations

The 18-year-old Caspian Restaurant in Irvine faces fines of more than $300,000 levied by a state labor agency over allegations that it violated wage and insurance laws.

The Persian food restaurant said Friday that it plans to appeal.

The state Labor Standards Enforcement division alleges that the restaurant failed to pay minimum wages, overtime pay and workers’ compensation and did not provide itemized statements on some paychecks.

“It’s a large fine for one employer,” said Dean Fryer, spokesman for the division’s labor commissioner.

Restaurant co-owner Mohammad Ariarad denied all allegations except those related to worker’s compensation violations, which resulted in a $28,000 fine. He blamed that situation on an accountant’s error. Fryer said the restaurant recently implemented a compensation plan but still must pay the fine.

Ariarad was upset.

“It’s nonsense that somebody would all of a sudden raise these claims against us,” he said. “We have not agreed that we are going to be paying all these fines. I guess I’m guilty unless proven unguilty.”

Fryer said the state received the original complaint about the restaurant from an employee and then began an investigation.

Ariarad said his business is being unfairly targeted by a disgruntled employee. “If we had been practicing unfair business, it would have been raised years ago,” he said.

Fryer said an audit of 14 employees found that at least four had not received minimum pay on 161 occasions during a one-year period and had not received overtime pay due them.

The agency ordered the restaurant to pay the employees $170,106 in back wages and overtime. The state also fined the restaurant $8,050 for minimum-wage violations.

The investigation also found that in the case of seven employees, paychecks did not contain itemized statements a total of 395 times over a one-year period, ending Dec. 8. For that, the agency fined the owners $98,750.

“They needed to have proper documentation to show how all the withholdings were held and distributed to the proper agencies,” Fryer said. “That documentation did not exist.”

An administrative hearing before the agency on the restaurant’s appeal has not been scheduled.

Established in 1982, the restaurant is co-owned by Ariarad and his two brothers, Hahmid and Ali, as well as a fourth partner, Housnang Tabatai.

The 400-seat restaurant has about 45 employees and features live musical entertainment and classical belly dancing.