Venerable Honolulu bakery The Patisserie has taken over a competing bakery facing possible criminal action by the state over unpaid wages alleged by many employees.
Patisserie assumed operations of the Gourmet Delite bakery in Iwilei on Sunday in what company representatives describe as a merger of Gourmet Delite’s manufacturing and wholesale operations. Gourmet Delite supplied baked goods to 7-Eleven stores.
A Gourmet Delite retail store at Marine Corps Base Hawaii in Kaneohe isn’t involved in the merger, according to employees.
It’s unclear what the combination means for 62 present and former Gourmet Delite employees the state says are owed at least $109,043, though it’s possible the takeover will help resolve the wage delinquencies.
Gourmet Delite owner Ronald G.S. Au did not respond to e-mails seeking comment yesterday. Au, 74, is a well-known local attorney who was suspended from practice in 2005.
The Patisserie’s owner, Robert Paparelli, was unavailable for comment yesterday.
The Patisserie was established in 1968 and operates a production facility near the airport and a retail store downtown, according to the company’s website. Among Patisserie products are Harvest Hawaii gourmet breads and Rolf’s Lavosh.
According to state business records, Au incorporated Gourmet Delite in July 2005, listing a mailing address similar to his longtime law office.
It was also in July 2005 that the Hawaii Supreme Court suspended Au from practicing law in Hawaii for five years for violating several ethics rules.
According to the court’s ruling, Au’s violations included depositing a client’s payment for legal fees into his personal business account before earning them, and improperly paying fees to a nonattorney "runner" in exchange for client referrals.
The court also said Au violated rules prohibiting a lawyer from making a false statement to a tribunal and from engaging in conduct involving dishonesty, fraud, deceit or misrepresentation.
Au, who was admitted to the Hawaii bar in 1963, had sought to be reinstated to practice law but was denied by the Hawaii Supreme Court on Monday. The court said that during his suspension, Au represented himself and Gourmet Delite in arbitrating issues in a business lease case in violation of court rules.
Au could represent himself but not Gourmet Delite, the court said.
The court said Au may not seek reinstatement until Dec. 31, 2012.
Au’s trouble operating Gourmet Delite involves employee wages, according to information from the state Department of Labor and Industrial Relations.
The department disclosed last week that 70 wage complaints have been alleged against Au over the past two years, and that the department found Au owed more than $109,043 to 62 employees.
The department said Au is making weekly $1,000 payments to the department, which forwards the money to employees.
But the department also indicated that it has requested that the state attorney general’s office pursue criminal action against Au.
The amount of wages owed makes the Gourmet Delite case one of the biggest in the state. The Labor Department averages around $500,000 in substantiated wage deficiencies a year among a few hundred cases.
Wage deficiency case information is confidential, but the case of Gourmet Delite was disclosed to state Rep. Karl Rhoads, chairman of the House Committee on Labor and Public Employment.
Rhoads inquired with the Labor Department last month after six Gourmet Delite employees complained to him about being unable to cash payroll checks.
Issuing payroll checks to employees knowing that insufficient funds are available is a criminal violation of the law.
Au indicated in a written response to Rhoads last week that Gourmet Delite had "personal problems" with the six employees who left the company last summer and that the bakery is making up back wages $1,000 a week through the Labor Department.
Au also said in the letter that the department and attorney general’s office were working closely with Gourmet Delite to resolve employee wage disputes and maintain an annual payroll of just under $1 million and 45 employees.
A copy of the letter was sent to the Star-Advertiser last week from Au’s office after leaving a phone message for Au.
Rhoads said he hopes that the merger with Patisserie will help correct wage deficiencies. "I think it’s good news," he said.