The opinion of the court was delivered by: Richard J. Holwell, District Judge:
MEMORANDUM OPINION AND ORDER
Plaintiffs bring this suit pursuant to the Fair Labor Standards Act, 29 U.S.C. § 201 et seq. ("FLSA"). They allege that their employers paid them less than the minimum wage, yet illegally retained a portion of their tips. Defendants Mario Batali ("Batali") and Joseph Bastianich ("Bastianich") own a group of restaurants in New York metropolitan area: Babbo Ristorante e Enoteca ("Babbo"), Otto, Casa Mono, Bar Jamon, Esca, Lupa, Del Posto, and Tarry Lodge. Pasta Resources, Inc. ("Pasta Resources") administers these restaurants, performing services like administering payroll and managing gift cards. Plaintiffs work at five of the eight Batali restaurants. They now seek conditional certification of a class so that they can send out notice to other tipped employees at all eight of the Batali restaurants. Defendants do not contest conditional certification with respect to employees of the five restaurants where plaintiffs work: Babbo, Otto, Casa Mono, Bar Jamon, and Tarry Lodge. But they argue that the Court should not certify a class as to Esca, Lupa, and Del Posto because the plaintiffs have not made a sufficient showing that employees of these restaurants were subject to a common policy of withholding tips.
Plaintiffs are all employed by Batali restaurants. They held various positions in these restaurants, such as backwaiter, server, and bartender. At the end of evening, these employees would divide up tips according to a formula. They all allege that the house deducted a portion of the night's wine sales from the tips they were supposed to receive.
Herman Alvarado ("Alvarado") and Stephanie Capsolas ("Capsolas") are both employed at Babbo, Alavarado as a backwaiter and Capsolas as a server. (Bien Decl. Exs. X, AA.) Both report that Babbo deducted 4.5% of total wine sales from the tip pool, and Capsolas attaches a pre-printed tip worksheet that indicates that 4.5% of total wine sales are to be deducted. (Bien Decl., Ex. AA.)
Sara Barron ("Barron"), Jeffrey Cutaiar ("Cutaiar"), and Andrew Ranaudo ("Ranaudo") all worked for Otto as servers. (Id., Exs. Y, CC, and HH.) All reported that Otto deducted from the night's tips a portion equal to the night's wine sales. (Id.) Barron and Cutaiar reported that Otto's managers told them that this amount went to the "wine program." (Id., Ex. Y, CC.) Cutaiar reports that a general manager at Otto indicated that this money went back to the house. (Id., Ex. CC.)
Roger Caro ("Caro") and Daniel Jansen ("Jansen") work as servers at Tarry Lodge. (Id., Exs. BB, FF.) Caro briefly worked as a manager, but returned to being a server. (Id., Ex. BB.) Both reported that a portion equal to 4% of the nightly wine sales was deducted from the nightly tip pool. (Id., Exs. BB, FF.) Caro provided a spreadsheet dividing a night's tips among the wait staff that documents the 4% deduction. (Id., Ex. BB.) Both also report that in a staff meeting partner and owner Nancy Seltzer refused to justify the policy and said it was not going to change. (Id., Exs. BB, FF.) Paul Toro ("Toro") also worked as a bartender at Tarry Lodge. (Id., Ex. II.) He reports that 4% of the nightly wine sales was deducted from the tip pool. (Id.) He further reports that when he asked Seltzer about the deduction, she said that it was a policy across the Batali restaurant group that a portion of the night's wine sales went to the house. (Id.) On another occasion, Toro heard Seltzer say that the money went to cover expenses related to wine research. (Id.)
Chris Ell ("Ell") and Chris Forbes ("Forbes") are both former employees of Casa Mono. (Id., Exs. DD, EE.) Ell worked as a server, and Forbes worked as a server and bartender. (Id.) Both indicated that 4% of nightly wine sales was deducted from the tip pool, and both provided a blank, pre-printed worksheet that included a space for the 4% deduction. (Id.) Both heard various explanations for the deduction, including that it was supposed to cover broken glassware and that it helped to fund the wine program. (Id.)
Jesse Patrick ("Patrick") is a former bartender at Bar Jamon. (Id., Ex. GG.) He reported that 4% of the night's wine sales was deducted from the tip pool each evening. (Id.) He provided a pre-printed worksheet that included a space for the 4% deduction. (Id.) He indicated that he was not entirely certain why the 4% was deducted, but stated that the bartender who trained him told him that the 4% went to the wine program. (Id.)
Each of these restaurants operates as a separately incorporated entity. (Taylor Decl., ¶ 9.) Batali and Bastianich have an ownership stake in each of the entities, though the exact percentage varies from restaurant to restaurant. (Id.) Both oversee the operations of each restaurant and visit each restaurant regularly. Pasta Resources is a separate company that provides administrative support to the restaurants, including payroll and marketing. (Id., ¶ 5.)
Plaintiffs seek conditional certification of a collective action pursuant to § 216(b) of the FLSA, which provides, "An action to recover . . . may be maintained against any employer (including a public agency) in any Federal or State court of competent jurisdiction by any one or more employees for and in behalf of himself or themselves and other employees similarly situated." 29 U.S.C. § 216(b). The Second Circuit has endorsed a two-step method for managing FLSA collective actions. In the first step, the court authorizes plaintiffs to send out notices to potential opt-in plaintiffs who may be similarly situated to the named plaintiffs with respect to the FLSA violation alleged. Myers v. Hertz Corp., 624 F.3d 537, 555 (2d Cir. 2010). "The court may send this notice after plaintiffs make a 'modest factual showing' that they and potential opt-in plaintiffs 'together were victims of a common policy or plan that violated the law.'" Id. (quoting Hoffmann v. Sbarro, Inc., 982 F. Supp. 249, 261 (S.D.N.Y. 1997)). "The modest factual showing cannot be satisfied simply by unsupported assertions, but it should remain a low standard of proof because the purpose of this first stage is merely to determine whether similarly situated plaintiffs do in fact exist." Id. (internal quotations and citations omitted). "At the second stage, the district court will, on a fuller record, determine whether a so-called 'collective action' may go forward by determining whether the plaintiffs who have opted in are in fact 'similarly situated' to the named plaintiffs. The action may be 'de-certified' if the record reveals that they are not, and the opt-in plaintiffs' claims may be dismissed without prejudice." Id.
I.Existence of a Common Policy or Plan
Defendants' primary argument against certification with respect to Esca, Lupa, and Del Posto is that plaintiffs have not adequately shown that these restaurants had a tip deduction policy similar to the policies where the named plaintiffs worked. They argue that each restaurant functions as a separate entity and sets its own policies, including tip policy. As evidence for this claim, defendants point to the fact that the amount deducted varied from 4-4.5% of total wine ...