Staff and house rules — how to keep your license

When you hire

• I-9 — Every employer that hires staff in the United States must complete the employment eligibility verification form (Form I-9). Family members and acquaintances are not exceptions.
• Overtime — Hours over 40 in a week are paid at 1.5 times the regular rate. Some states add a daily threshold.
• Tips — Owners, managers and supervisors may not keep employees' tips (U.S. Department of Labor).
• Workers' compensation insurance — Example: California requires it if you have even one employee, and failing to carry it can be punished as a misdemeanor. Texas does not require it of most private employers.
• Sexual harassment prevention training — Example: California requires employers with 5 or more employees to provide 2 hours of training for supervisors and 1 hour for other employees within 6 months of hire, and every 2 years after that.
• Alcohol service training — Example: California requires employees who serve alcohol, and their managers, to obtain RBS certification within 60 days of hire. Washington (MAST) and Illinois (BASSET) also have mandatory training.

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Many cities and counties set a higher minimum wage (for example, the City of Los Angeles and New York City). We could not verify New York State's tipped-employee wage from the table.

Five things that get a venue shut down

The violations below recur in actual enforcement and disciplinary records. Give them to your staff in writing from the first day you open.

1. Hostesses (doumi) and drink solicitation — California law provides that the liquor authority must revoke the license of a venue that pays someone a commission or salary to encourage customers to buy drinks (B&P §24200.5(b)). Knowingly allowing such a person to remain on the premises is also a crime (§25657). A karaoke lounge in San Francisco received a 45-day suspension under this provision in 2014. Even when hostesses are called in from outside, the same problem arises if the venue arranges or tolerates it. It is illegal and is grounds for license revocation.
2. Alcohol after closing time — Alcohol cannot be sold after 2 a.m. in California or after 4 a.m. in New York. In 2015, an owner and two employees caught in a 2:30 a.m. enforcement action in Los Angeles Koreatown were convicted and received one year of probation.
3. Alcohol without a license, or outside the scope of the license — Serving a type of alcohol your license does not permit, or letting customers drink alcohol they brought in when you have no license. In 2020, two karaoke venues in Flushing were closed after operating with no liquor license and only one exit.
4. Violating room conditions — Covering windows, locking room doors, exceeding the occupancy limit (the Permits & Licensing section).
5. Minors and safety — In 2021, a karaoke venue in Flushing had its license suspended immediately after a shooting, when a liquor authority investigation brought 24 charges including underage drinking, unlicensed security guards, fire safety violations and operation by someone other than the license holder.

In January 2026, noraebang owners in Los Angeles Koreatown formed the K-Town Entertainment Association, with the stated aims of ending illegal conduct and restoring trust in the industry (Korea Daily). If there is a local association, it is a good idea to introduce yourself before you open and to hear what the enforcement standards are in that area.