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The J. Clyde Restaurant Ordered to Close for Not Carrying Workers’ Compensation Insurance

police-line-3953745_1920-300x199A restaurant in Birmingham, Alabama, has been ordered to close until they obtain workers’ compensation insurance coverage for their workers and pay fines owed to the state.

The J. Clyde, a popular restaurant in the lively Southside district of Birmingham, closed its doors in early June after a judge ruled it was in contempt of court after operating without workers’ compensation insurance for its employees. A sign on the door, issued by Jefferson County Sheriff Mark Pettway, reads “Business closed by order of Circuit Court of Jefferson County for failure to provide workers compensation.”

This closure marks the culmination of months of legal wrangling. In August 2018, the Alabama Department of Labor alleged that The J. Clyde had failed to carry workers’ compensation for its employees “on numerous occasions.” According to state law, any business which employees five or more people must show proof that they can either self-insure their workers’ compensation liabilities. If they cannot, they must obtain workers’ compensation insurance for their employees.

The restaurant did not respond to the Department of Labor’s lawsuit, and so, in November, Jefferson County Civil Circuit Judge Carole Smitherman ordered that the business proffer proof of appropriate insurance coverage within ten days. The restaurant was to remain closed until this had occurred, she said. The Civil Circuit Judge also issued a $1,000 fine on The J. Clyde and ordered that a fine of $100 per day would be levied for each additional day beyond the first ten that the restaurant did not have coverage for its employees.

The owners of The J. Clyde did not respond, and the restaurant continued to operate. In January, the state requested that the restaurant be held in contempt of court and recommended “shutting down and padlocking” the business until they had paid all fines and had workers’ compensation coverage.

In April, the Civil Circuit Judge issued an order which said that The J. Clyde would have to close. Additionally, the business was held in contempt of court. The J. Clyde owes $14,600 in fines according to court documents.

When asked for comment, attorneys with the Department of Labor would only confirm that The J. Clyde has not yet given them any proof of workers’ compensation coverage and that, as a result, the restaurant would remain closed for business. The owners of The J. Clyde have not returned calls requesting comments on the case. This is in line with The J. Clyde’s approach since last summer. The restaurant has not responded to the Department of Justice’s original lawsuit, to any court documents, nor to any orders issued by the court. There are no known attorneys for the business.

Currently, the door to the restaurant has been padlocked shut, and caution tape has been secured to the door frame. In addition to the County Sheriff’s message, a second message from The J. Clyde’s owners is visible: “The J. Clyde is temporarily closed,” it reads. “We are currently addressing the issue and will be reopening as soon as possible. We apologize for any inconvenience.”

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2019-06-18 Birmingham Restaurant Closes for Not Having Workers’ Comp Insurance, Owing Thousands in Fees

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