“It’s not about the tips,” the valet driver says. “It’s about the customers themselves. They are really nice ... and they are not drunk, like trying to do something weird.”
Abdullah was a pharmacist in Aleppo, Syria, before he immigrated to Dallas over a year ago. Now he parks cars at a few of Dallas’ ubiquitous valet stands for a living. Tonight he’s at the Eberhard, a Henderson Avenue club that, unlike the Italian restaurant, is open late and sells lots of expensive booze. Valet parking here is mandatory and costs $5.
Moments later, a woman leaving the Eberhard alone approaches the valet stand and demands her car keys. “It’s right here,” the woman yells at Abdullah. “Can I just drive it out? I don’t care.”
Aaron, a student from the Congo who has been on the job for two months, watches the exchange and laughs. (Both men asked we use only their first names. Most of the valets we spoke to for this story didn’t want to be identified. You’ll see why.) Outbursts like this, from club patrons who are angry about paying for valet service, happen often.
In many cities, valet parking is considered a luxury for customers of upscale restaurants and hotels. But here, in the home of the $30k millionaire, valets park cars at Tex-Mex restaurants, coffee shops, bars, hospitals, some apartment complexes and Dallas’ large selection of exorbitantly priced steakhouses. Local laws allow businesses to obtain valet licenses easily, leading to what Dallas City Council member Philip Kingston calls an “amazing proliferation” of valets in recent years. In his District 14, where much of Dallas’ trendy nightlife is concentrated, Kingston counted 83 valet licenses issued last year, and he says businesses don’t always bother to get them. Traffic on Lower Greenville Avenue used to be choked with so many valet drivers parking cars that Kingston asked the restaurants to start sharing some of their valet stands.
“You can talk to any restaurant, and they will tell you there’s a certain segment of their business that is just going to use valet … and that wouldn’t come to the restaurant if valet weren’t available,” Kingston says.
A glut of valet stands creates problems for residents, customers and the valet drivers themselves. On residential streets, homeowners complain about the incessant wail of car alarms as valet drivers hit cars’ remote panic buttons so they can follow the racket to their quarry. Valet drivers say they are expected to work during snow and ice storms, and some have to foot part of the bill if they damage a car. “I only lost one set of keys,” one driver says proudly of his accident record. “They used the company’s insurance, but [for] half of it. It being my mistake, they took a part of my paycheck.”
At Concrete Cowboy, a McKinney Avenue bar that bills itself as “the ultimate party bar for grown ups” and sells drinks like the marshmallow margarita, customers sometimes appear too drunk to drive home, says one valet driver on duty there recently. He and valet drivers at other Dallas bars say they often have to withhold car keys from angry, would-be drunk drivers until police arrive. Some drivers handle drunks by simply handing the car keys back to the restaurant manager, letting the establishments deal with the problem they created.
Though the presence of valet drivers standing between drinkers and their car keys may prevent car accidents, valeting is not an entirely reliable method to protect drunk drivers from themselves — and us from them. One valet recalls leaving work at a club on McKinney Avenue on a slow night and being approached by a drunk man looking for some fun. “So I took him to this strip club, and he gave me $350,” the valet says. “I left his vehicle, I called my brother and he picked me up.”
He was lucky. He got to keep the $350 tip, but that’s not always how it works, particularly at the many “free” valet stands in the city.
At numerous places, restaurants advertise that valet parking is “complimentary.” A company called RP Valet operates many of those stands and once had valet contracts at most destinations in Uptown, former workers say. Though no longer the force it once was, RP Valet stands still can be seen offering free valet service at over a dozen locations in downtown, Uptown and Oak Lawn.
Of course, nothing in life is really free, and the important question is always: Who pays? As some of RP Valet’s drivers have discovered, it’s them.
Valet companies typically pay drivers a salary that varies every shift, from minimum wage to $20 an hour. The earnings change because the drivers are paid partly with their own tips under a system referred to as “tip credit.” Common across the service industry, the system is the target of calls for reform and damned for allowing businesses to exploit low-wage workers.
Under federal law, employers themselves must pay workers who regularly make at least $30 a month in tips a minimum wage of $2.13 an hour, a figure that has not risen since 1991. All employees, however, must receive at least the federal minimum wage of $7.25 an hour. So how do Texas employers cover the difference between the $2.13 an hour they pay out of their own pockets and the $7.25 minimum wage? Tips. Employers can claim a $5.12 per hour “tip credit” from employees’ tips. (If the employees don’t earn enough in tips to cover the $5.12, employers must make up the difference and pay the full $7.25. Any excess amount, on the other hand, goes back into the hands of the employees. Supposedly.)
Employers may also pool their workers’ tips, divvy them up and shovel them back to eligible workers as hourly wages, with the employer still getting the $5.12 credit. In one of the few reports evaluating the tip credit form of payment, a left-wing think tank called the Economic Policy Institute last year found that workers paid in their own tips are “nearly twice as likely to live in poverty as are non-tipped workers” and that “job quality, as measured by access to benefits, is far worse for tipped workers.”
It’s even worse if an employer ignores federal wage laws that say tips belong to the people who earn them, not the employers.
At RP Valet, company managers have taken this “tip credit” payment practice one step further. Through a complicated system, RP Valet drivers are sometimes asked to give their bosses a portion of their tips. The company even has official-sounding names for it: a “booth fee,” a “management fee” or a “ticket fee,” as current and former workers describe it. Valet drivers, many of whom are immigrants or men still in school, tend to be unfamiliar with tipping and minimum wage laws. They blame themselves if they don’t earn enough in tips to pay their bills and give their managers a share. “Turning our tips in, I thought that was the right thing to do,” says Jason Thomas, who worked as a driver and account leader at RP Valet for six years.
At one of the numerous Oak Lawn restaurants advertising “complimentary” valet service, an RP Valet employee standing by in his trademark black shorts and white-collared T-shirt insists that valet parking is never free. “We don’t say it’s complimentary, we tell them we work for tips,” says the driver, who was handed a $20 tip by a couple in a Ferrari as we interviewed him. “Besos,” he says to thank them. A $20 tip is unusually high — most customers tip around $5, and some nothing at all. But what the Ferrari-driving couple may not have realized in their generosity is that a portion of that $20 tip is going to someone else. At the end of his shift, this driver says he is expected to give his manager $90 out of all the tips he received that afternoon. He calls it a booth fee.
“I don’t like the booth fee,” says the driver, though, like other drivers, he believes he needs to pay it. “The booth fee is the one that keeps the company alive,” says his coworker and friend, who valets at another complimentary location.
Arash Farasat used to feel the same indifference toward letting RP Valet keep a chunk of his tips. “At the time, I didn’t understand the reasoning, that when someone’s tipping me, they’re really tipping me,” Farasat says, “so I never really felt it was immoral that the company was taking my tips.”
Farasat graduated from high school in Austin just over a decade ago and went straight into the workforce. When Farasat was 19, he connected with a family friend named Roozbeh Payervand, the man valet workers often refer to as “RP.” Payervand founded the company bearing his initials in 1987 and led the company afterward as the CEO. To valet drivers, Payervand is a charming, likable salesman. “He’s cool,” says one current driver. For Farasat’s first several weeks on the job, Payervand even let him stay in his guest house in the Turtle Creek neighborhood.
Farasat’s living situation, on the other hand, was modest. He eventually moved into a north Dallas efficiency, where rent has stayed under $600. He drove and still drives a 1995 Ford Crown Victoria. A September 2011 pay stub he provided the Observer shows that his earnings at RP Valet fell just below $7,000 during the year up to that date, despite his working at least 30 hours each week and sometimes over 40, he says, though he claims RP Valet failed to account for overtime. RP Valet paid him the $2.13 federally mandated minimum wage, his pay stub shows, while the rest of his earnings came from what the pay stub says is “tip credit.” His boss Payervand, meanwhile, was earning $30,000 a month, a loan application he filled out indicates. “I had a salary commensurate with the industry standard,” Payervand writes in an email to the Observer, and claims his annual salary was only $70,000. (The application was included in Payervand’s 2009 divorce case.)
Initially, Farasat says, RP Valet workers were paid $8 an hour in cash at the end of their shifts. Then they were told to place all their tips either in a box or in the hands of the manager in charge of the shift, Farasat and other former coworkers say. At the office, the manager gave Payervand a “management fee” that ranged from 30 to 60 percent of the tips the drivers collected that night, says Farasat, who also sometimes worked in the main office. In 2007, Payervand changed the fee system. “People were keeping some of their tips against the company’s policy, but they [RP Valet] wanted to develop a system where that doesn’t matter,” Farasat says. Before the change, the workers appeared to be paid under the table, Farasat and another former employee remember. “We had engaged ADP payroll processing to run all compensations,” Payervand responds.
Under the new system, valet drivers were handed tickets and ordered to place one on the dashboard of every car they parked. Once the shift ended, drivers handed over their tickets and tips to the “lead” — the driver running the shift. RP Valet collected the tickets and charged the lead anywhere from 30 cents to a few dollars for each ticket. Once Payervand got his cut, the lead decided how to divide the tips that were left. Drivers say some of the leads would hog the remaining tips for themselves. “RP never really asked about your tips, he just wanted his management fee,” says a former driver.
Late at night, at two or three in the morning, the leads would meet upper-level managers in the company’s main office, where they would hand over wads of cash from their tips. In 2012, Farasat recalls, he heard rumors that three RP Valet workers were held up by masked gunmen and ordered to hand over the cash. (After the robberies, “We changed the processing procedures and installed a bulletproof entry door with a buzzer system — which cost about $6,000 — to protect the employees,” Payervand responds.)
Farasat says he approached one of the alleged victims when he saw him afterward. Farasat says his coworker revealed to him a secret. “He said, ‘You know, he [Payervand] is not even supposed to take our tips like that,’” Farasat recalls. His coworker had heard from an attorney that Payervand couldn’t ask the drivers to pay “fees” out of their own tips. “It was pretty shocking because I realized there was a lot of money they were ripping me off, if that was true.”
Farasat researched tip laws and found that the federal Fair Labor Standards Act is clear on the issue: “[An] employer is prohibited from using an employee’s tips for any reason other than as a credit against its minimum wage obligation…”
Farasat says he quickly arranged a meeting about the matter with Payervand. It did not go well. “If you were ever out in that parking lot at night, and someone wanted to hurt you, I would be the one to stop it,” Farasat claims Payervand told him, otherwise dismissing his concerns about his lost tips. (“Of course I would be the one to protect my employees if anything were to happen to them,” Payervand writes.) Shortly after, Farasat says, he discovered he had been suspended from work. By that time, Farasat had been working for RP Valet for seven and a half years. So he got on the phone with the Department of Labor, initiating an investigation in 2012.
Investigators spoke with Farasat on the phone and in person for months. They explained to him the technicalities of how the tipping law works. RP Valet can keep any money deemed a mandatory parking charge, he learned. But the company didn’t have a right to his gratuity. It’s a distinction that can be easily blurred. For example, at Perry’s Steakhouse, RP Valet mandates in a contract with the restaurant that it can ask for a “mandatory $5 gratuity” from Perry’s patrons. But several current RP Valet drivers who work at Perry’s say that they pay their employer a $5 fee for every car they park. That’s on top of a $206 management fee that Perry’s agreed to pay RP Valet every week, a three-year contract between the two businesses shows.
To Farasat, the federal investigation appeared to quickly fall apart. RP Valet representatives “stated that the valet had a big sign of $5 or $10 ticket rate at valet parking,” the government report says. During the investigation, “The valet had a big sign with dollar amounts in most accounts … a service charge is not part of tipped income.” Reza Saleh, a friend of Ross Perot who was famously convicted of insider trading in Dallas years ago, acted as RP Valet’s representative in the investigation. Saleh told the government that workers kept all of their tips, the report says. Payervand downplays the Department of Labor’s findings. “The company was audited by DOL,” he writes. “Ticket fees are supplemental revenue for the company to help pay for expenses ... All employees earned between $10 to $22 per hour. If they earned less, they would quit and leave for a better job somewhere else.”
But the Department of Labor did find RP Valet had committed numerous other wage violations, including charging workers a “fee” from their tips for their own uniforms. The feds write in their report that the company failed to pay overtime to 76 employees and charged 72 employees uniform fees from their tips. All in all, RP Valet owed its workers $78,000 in back wages, the report says. At the time, Saleh told the feds the company would pay the back wages by the following year, in 2014.
On a late afternoon in the Oak Lawn/Cedar Springs neighborhood, a valet driver runs back and forth through a busy parking lot. The valet parking here is complimentary. The driver remembers getting a letter in the mail a few years ago, informing him that his employer owed him $7,000 for the overtime wages he was never paid. He still hasn’t seen the money. “Why do you think rich people stay rich? Because they don’t spend money,” the valet says. When his shift is over, he will owe his boss a management fee of $85.
The government has little explanation as to why it never got RP Valet to pay workers the wages the government said it owed. “The company agreed to pay back wages and obey the law, but they failed to pay the back wages,” says Juan Rodriguez, a spokesman with the Department of Labor’s Dallas office, in a brief statement about RP Valet.
Around the same time that the Department of Labor was investigating RP Valet, customers who say they had their cars wrecked by RP Valet drivers were suing. A 2012 suit filed by an insurance company demands $14,000 from RP Valet for vehicle damage. The next year, a customer of Perry’s Steakhouse said his car had been returned to him with a busted rear window, and his cash, laptop and briefcase inside were missing. He learned that the RP Valet driver had simply parked his car “on the curb of a side street adjacent to Perry’s.” RP Valet’s own insurance company sued the company the next year for never paying its $10,000 deductible after causing $9,000 worth of damage to a customer’s Maserati. A patron at the Prime Bar said his Escalade was stolen from the back of a parking lot on Routh Street where RP Valet had left it. At a private party at the Avenu, an attorney named Daniel Kondos said his Bentley Continental was returned to him by the RP Valet driver with a scratched front bumper. Kondos says that the company promised to pay him, but the promises turned up empty. After he sued, he won a $2,750 judgment against RP Valet in January 2014. But Kondos says he hasn’t seen the money, either.
Kondos’ winnings in court came at a bad time. Payervand recently filed for bankruptcy, he learned. Payervand lists the people suing him, attorneys and his ex-wife among his creditors. His assets include a $4,500 Rolex. Payervand claimed to have only $63 in the bank. During the bankruptcy hearing, Payervand distanced himself from RP Valet. “Some of the employees decided they wanted to just go on their own and do what I was doing back then for them,” Payervand says during the deposition. The attorneys and creditors press him on the stand, asking how he lost the company. “I was very distracted by my divorce case, I have really not been involved with the business for the last few years,” Payervand says.
An attorney in the recording asks Payervand about RP Valet’s current ownership. “The company was shut down so I don’t understand your question,” Payervand says. Asked the sam
The federal government says only of the situation: “When the [payment] deadline was not met, the Wage and Hour Division initiated a second investigation and discovered that the company had been sold to new owners.” (Payervand claims that the company was insolvent.)
Farasat, frustrated with what he viewed as the Department of Labor’s inaction, initiated a class action lawsuit with the help of the Equal Justice Center, a nonprofit that gives free legal help to low-income workers. At an early court hearing, Payervand failed to even show up, giving Farasat and his coworkers a default judgment. But Payervand’s bankruptcy has stalled the case. In an August 2015 affidavit Farasat includes in his case, a former driver named Peyman Fazeli says that Payervand still appeared to be running the company as late as March of this year. Payervand had stopped by The Palm steakhouse and asked about a friend’s qualifications to valet, Fazeli writes.
Current employees who have worked at RP Valet for years say the company now has a new name, RP.MTV Valet Parking. They believe that the company may have new owners but aren’t sure who they are. They are also unsure of Payervand’s involvement. One worker, who defends Payervand and says he is a good guy, says that he saw Payervand several weeks ago. “He said, ‘It’s good to see you back,’” the worker says.
“I have no comment on anything other than to tell you RP does not run the company anymore,” says Scott Bennett, a manager at RP Valet. At the company’s main phone line, a man who answered responded to an interview request only with, “Yeah, have a nice day,” before hanging up. Payervand agreed to answer questions if they were sent through an email. Payervand says now that his managers purchased his former RP logo because it is a “name with brand recognition after 27 years of presence in the market.” He maintains that he has nothing to do with the company. “This is a common lingering misperception due to the name (RP).”
As offices nearby in Uptown and downtown close for the day, the parking lot of Nick and Sam’s Steakhouse on Maple Avenue becomes busy with a stream of luxury cars and distinguished-looking customers in suits. “Sir, do you have a key?” a valet driver calls to one of the suits, who is already walking away from his car. “I left it on the floorboard. Sorry, man.”
The tips at the pricey Uptown steakhouse can be huge, valet drivers who used to work there say. RP Valet used to operate the lucrative account before getting pushed out by Prime Valet, a rising competitor. “Once you realize how much money is coming in, it [your pay] does not add up at all,” says Thomas, the former RP Valet employee who says he could leave a Nick and Sam’s shift with a disappointing average of $10 an hour. “You have guys tip with $100 bills sometimes.”
Prime Valet’s founder is Jason Weeks, a former RP Valet employee who left in 2012. Farasat and several others identify Weeks as the jaded co-worker who told them that Payervand was allegedly stealing their tips. Several former Prime Valet employees say Weeks urged them to follow him to his new company.
But at Prime, the former RP and Prime drivers claim, Weeks continued to take money they felt should be theirs. “I was making a lot of money in tips from my customers, and they want all the money,” says Rafael Campuzano, a former Prime driver. For six months, Campuzano says, he received no paycheck and angered his new bosses by keeping his tips. He was fired for refusing to turn his tip money over, he says. “I’m really pissed at Jason.”
Another former driver who worked under Weeks when he was still an account lead at RP Valet tells a similar story. At Nick and Sam’s, where the driver worked, he says his pay was always a flat $15 an hour from the tipped cash. “I’m not stupid. I look at the money that’s being brought in,” he says. “I know there’s nights I should have made more.”
Farasat, the RP whistle blower, also joined Prime Valet shortly after his firing from RP. He tried to reason with Weeks about payment and stayed with the company through the next year. Weeks was cordial with Farasat but defended following in RP Valet’s footsteps, an email shows. “I had to start out with N&S [Nick and Sam’s] the old Rp way but it’s a stepping stone to get in the right direction,” Weeks tells Farasat in a 2013 email that Farasat showed the Observer. “What we have here is a law that was put in place for waiters and strippers,” Weeks writes of the law that is supposed to allow valet drivers to keep their tips. “Valet falls into the ‘waiter’ category. Restaurants don’t need tips to stay in business because the waiters sell food and booze. Valets sell nothing. Thankfully N&S brings in enough business that the guys are happy but this is not the avenue we want to go. I’m heading in the right direction.”
Weeks thanks Farasat for his concern, telling him he’s a “good man,” the email shows. But by the next year, Farasat was fired. Prime’s second-in-command, Jason Ramirez, tells Farasat in an email at the time: “We want to keep a positive environment and you have left employees, including myself, feeling uncomfortable.”
Farasat pressed the Department of Labor to prosecute Prime Valet, too, along with RP, but the agency told him they couldn’t gather enough evidence. In interviews with the government, Weeks “stated he knew Mr. Farasat filed a complaint or lawsuit on RP and that it does not make sense for Prime to hire him if Mr. Weeks knew he was breaking the law.” At Nick and Sam’s valet parking was complimentary, former valet drivers there remember, but federal investigators told Farasat that workers’ tips weren’t being stolen. Prime representatives told the government that customers were charged to park at Nick and Sam’s. Farasat says he argued with an investigator named Kimberly Gilkinson on the phone. He told her to call Nick and Sam’s and ask them about their parking rates. “They’re going to tell you it’s complimentary,” Farasat recalls saying. The investigator, he says, only hesitated and told him, “I’m good at my job.” (Prime Valet was investigated that year but the feds found no violations, government records show). So Farasat tried putting pressure on Prime Valet through activism. He found another job and volunteered with the Worker’s Defense Project, the Texas nonprofit that typically advocates for construction workers. With the help of the group, Farasat drafted letters to give to managers at all three Nick and Sam’s locations in Dallas. The letters alerted the restaurant to a problem the Worker’s Defense Project describes as “wage theft.” But Farasat and then-WDP spokesman Juan Cardoza-Oquendo say that when they showed up to one Nick and Sam’s in person to deliver the letter, they were quickly shooed off the property by a Nick and Sam’s manager. She immediately threatened to call the cops, they remember. “I think that was probably the third or fourth time they were loitering in our parking lot,” the former manager, Nora Shields, now says when reached on the phone. “We don’t deal with that [valet parking] ... All of it is subcontracted.”
Prime Valet still parks cars at Nick and Sam’s. The valet manager on duty says his boss, Jason Weeks, would likely decline an interview about Prime Valet or RP Valet, and Weeks did not return subsequent messages. RP Valet’s Payervand has been through some difficult times, the Prime Valet manager adds. He only wishes his competitor well.
Farasat isn’t surprised to hear that valet drivers at RP Valet’s complimentary stands still feel they need to pay a “fee” to support their bosses. “I feel that I was manipulated,” Farasat says now, reflecting on why it took him so long to realize he should get to keep his tips. “Jason Weeks told me that a lot … that he needed to do it, to keep the company going, but I don’t believe that because there’s companies that don’t do it.”
At a private party in Uptown, the RP Valet driver charged with collecting parking tickets thinks he will have to pay his bosses a 30-cent fee per each car he parks that night. Yet the party-goers are able to use the valet service at no charge. The valet driver blames customers who don’t tip, not his bosses, if his paycheck is low. “This company has been, I guess, good,” the driver says. “A lot of people don’t tip over here.” If he walks away with $12 hour, he calls it a good day.
Why So Many Valet Stands
Loose regulations and the belief Dallas lacks parking, that’s why.
In Dallas’ trendy neighborhoods, some valet drivers and restaurant workers believe people couldn’t possibly handle parking themselves. One valet who works near Klyde Warren Park reasons that valet stands are prevalent in Dallas because the city has so little room for parking. Down on Lower Greenville, a restaurant manager offers a similar explanation.
“The parking is very minimal here on Lower Greenville,” says Eric Salvador, a manager at HG Sply Co., the restaurant that serves healthy paleo dishes and stiff drinks in the heart of the strip. “So we use it on Thursday, Friday and Saturday to try and squeeze in as many [cars] as possible ... so we can relieve some of the stress for the guests.”
But there is little data available in Dallas to confirm that valet parking really does help free up parking spaces for locals. City Councilman Philip Kingston, whose district has more valets than any other in the city, says he persuaded restaurant managers on Lower Greenville to cut down on their valet stands and consolidate with each other. Before, a single valet stand, serving a single restaurant, would hog as many as 11 parking spaces on a public street, Kingston says. A similar situation now brews in Uptown. “McKinney [Avenue] is a real problem. It suffers from the same thing that Greenville did,” Kingston says.
Of course, the argument that Dallas needs valets because we are short on parking ignores the fact Dallas isn’t nearly as dense as other major American cities. (City Hall is planning to begin a study to determine whether downtown has too few or too many parking spots.) At one restaurant, a manager anonymously rants that his friends who visit from New York and Chicago are amazed at the number of valet stands in Dallas. “Valets have a stranglehold on this city, and it’s suffocating,” the manager says. “I don’t want to be forced to tip somebody $5 to just park my car a few feet away.”
To be fair, locals in New York and Chicago have also complained about their city’s valet parking, but those cities at least offer residents more reliable public transportation as an alternative.
In Los Angeles, which also suffers from sprawl and a shortage of free parking in its nightlife districts, city officials last year introduced tough new restrictions on valet companies, requiring all drivers to undergo background checks and threatening that companies that operate without a permit could face criminal charges.
In Dallas, businesses can easily get a valet license. If a business in Dallas does not have “enough” parking spaces, a city of Dallas permit form explains, then the business can hire a valet company to park additional vehicles off-site. Doing so requires that the business get a permit, but Kingston says the valet permits are distributed so loosely that, as of last year, he counted 83 valet licenses in his district alone.