Rev. Greg Diaz federal wage investigation: Seven takeaways

Rev. Greg Diaz is one of the most prominent Hispanic religious and business leaders in Memphis, known for his popular TACOnganas food trucks. But he has faced criticism on social media in recent weeks amid allegations that he recruited dozens of taco workers from Mexico - possibly illegally - then made them work long hours for low wages.

The business is now under federal investigation. Diaz and a top manager didn't respond to multiple interview requests.

Here are the top takeaways from The Commercial Appeal's in-depth investigation on the labor situation at one of Memphis' hottest popular restaurant groups.

The U.S. Department of Labor has opened an investigation

In response to The Commercial Appeal's questions about Diaz and the TACOnganas businesses, a U.S. Department of Labor spokesman, Eric Lucero, confirmed that the agency's Wage and Hour Division is conducting an investigation. He said the agency couldn't comment further.

Diaz is one of the most prominent Hispanic leaders in Memphis

The investigation is a surprising turn for one of the best-known Hispanic leaders in Memphis. Diaz was born in Mexico, came to the United States as a child and is fluent in Spanish and English. He's built relationships with impoverished immigrants and the city's elite.

For years, Diaz has led a church congregation in southeast Memphis called Nueva Direccion and has appeared at high-profile panels and news conferences related to immigration and Hispanic affairs. He formerly served on the board for Compass Community Schools, the charter school group that took over the Memphis Jubilee Catholic Schools Network.

In addition to his work as a religious and community leader, Diaz has also run high-profile businesses, including the popular TACOnganas taco trucks and a new high-end Mexican restaurant in Germantown called Uncle Goyo's.

A leaked video in a Spanish-language forum sparked hundreds of reactions

The social media outcry appears to have begun in September, when someone posted a leaked video in a popular Spanish-language Facebook group in Memphis.

In the video, Diaz told TACOnganas employees that they had the right to one meal and one soda a day, and that if they took more without permission, then they were stealing - even if they took just one soda or one avocado.

In the video, Diaz threatened to fire the employees or even pursue them legally.

People immediately began criticizing Diaz over his tone and his policy.

In response, Diaz wrote that he recorded this video for employees, not for the general public, that he distributed the video through an internal WhatsApp chat group, and that he did it because employees had stolen cases of food and drinks from the business.

Still, many people took offense. People began making memes and videos mocking and criticizing Diaz.

Job ads surface - "The trip is not with a visa, but 100% safe."

Most of the criticism was in Spanish, but outrage spread to English-speaking social media too. People began to circulate job ads that Diaz appeared to have posted on Facebook last year and this year in forums for taco workers, many of whom live in Mexico.

The text of the advertisements urged experienced taco workers living in Mexico to come to Memphis and work with Diaz in the TACOnganas businesses.

The ads have since been deleted, but The Commercial Appeal copied several of the ads while they were still online and active. One advertisement was accompanied by a video of Diaz talking about the job opportunity.

Some of the ads said employees would work 12 hours a day, six days a week, and earn 13,000 pesos, the equivalent of about $656.

A key sentence appears in the text of at least three of the ads: "El viaje no es con visa pero 100% seguro," which means "The trip is not with a visa, but 100% safe."

In Spanish-language Facebook and beyond, the ads were widely read as an offer to bring Mexican workers to the United States illegally, make them work long hours and pay them low wages. Some social media users tagged law enforcement agencies to draw attention to the Facebook posts.

Experts say ads could cause legal problems for Diaz

It is not clear if Diaz broke the law.

However, experts interviewed by The Commercial Appeal said the advertisements could cause legal problems for Diaz.

Memphis immigration attorney Alicia Triche said said she didn't want to judge the pastor's actions, but she said the situation "raises flags."

She said federal law makes it illegal for anyone to encourage or induce an immigrant to enter the United States if they know that that person's entry or residence will be in violation of the law.

Federal law also makes it illegal for anyone to knowingly hire or recruit unauthorized immigrants, she said.

In the event of a human trafficking investigation, the advertisements could be used as evidence against Diaz, said Vinh Ho, a human trafficking expert at South Texas College of Law Houston.

Job schedules showed employees at TACOnganas routinely working long hours

The Commercial Appeal was unable to interview any workers who said they were recruited by Diaz in Mexico and brought to Memphis.

However, the newspaper interviewed three former TACOnganas employees who said they met Mexican cooks who seemed to work all the time. The newspaper also obtained job schedules that showed multiple employees scheduled to work six days a week, 12 hours a day - that's 72 hours a week, not counting breaks.

At certain times, some employees were scheduled to work even more than that. During the week of May 10-16, 2021, for example, three workers were scheduled to work seven days a week.

One of those employees was scheduled to work from 9 a.m. until 10 p.m. all seven days- a total of 91 hours, not counting breaks.

It is not clear if these workers were receiving overtime pay as the law usually requires.

Diaz announced the company would take a portion of tips

In February, Diaz distributed a memo telling TACOnganas workers that beginning in March, the company would take 30% of all tips left on credit cards.

Diaz wrote that the businesses intended to distribute money from the cashiers, who received tips, to other employees who did not receive tips.

However, the former employee who provided this memo to The Commercial Appeal, Isaac Goldring, said Diaz never told employees where the money was going.

Federal law allows business owners to set up "tip pools" which share tips among tipped workers and those who don't receive tips - but owners can't take any of the money.

“As long as everybody is earning the applicable federal minimum wage of $7.25, there can be a valid tip pool where the tips are pooled and redistributed to other non-tipped employees,” said Gus Tarantino, assistant district director for the the U.S. Department of Labor Wage and Hour Division in the Nashville office.

“What is not allowed in that situation if a manager or a supervisor or an owner or something along those lines is included in that tip pool and their tips are being diverted to a manager or supervisor.”

It is not clear if the policy was ever implemented as written, nor is it clear that Diaz ever broke the law in his handling of tips.

Goldring said he quit before the new tip policy was implemented.

Workers brought from Mexico might obtain legal visas, might file lawsuits

In the event that a human trafficking investigation takes place, workers who assist in the investigation should become eligible to receive visas to remain in the United States, legal experts said.

In addition, these workers could file civil lawsuits for damages and back pay.

Read the full investigation: Pastor, restauranteur Greg Diaz posted job ads implying he’d bring Mexican cooks to U.S. illegally

Investigative reporter Daniel Connolly welcomes tips and comments from the public. Reach him at 901-300-0682 or danieljamesconnolly@gmail.com. Yo hablo español.

This article originally appeared on Memphis Commercial Appeal: Top takeaways from TACOnganas and Greg Diaz investigation