Retail

Wage Fraud at Papa John’s

October 16, 2015
By Stephanie West

Eric T. Schneiderman

New York, NY – Attorney General Eric T. Schneiderman and the U.S. Department of Labor has announced four settlements totaling nearly $500,000 with three current Papa John’s Pizza franchisees and one former franchisee, who together owned a total of nine restaurants in Queens, The Bronx, and Brooklyn.

The franchisees investigated by the Attorney General and the U.S. Department of Labor’s Wage and Hour Division admitted to a number of labor violations, including minimum wage, overtime and other basic labor law protections. “Once again, we’ve found Papa John’s franchises in New York that are ripping off their workers and violating critical state and federal laws,” said Attorney General Schneiderman. “Fast food chains across the State should be on notice: we will not stop until your workers are treated with respect and paid lawful wages. Once again, I call on Papa John’s and other fast food companies to step up and stop the widespread lawlessness plaguing your businesses and harming the workers who make and deliver your food.”Back wages and damages will be distributed to over 250 underpaid workers. The investigations into the franchisees, covering various time periods beginning as early as 2008. 

  All investigated franchisees admitted to the violations. Some stores failed to pay employees the minimum wage and overtime wages required under the federal Fair Labor Standards Act and state law.Some stores violated a state requirement that employers must pay an additional hour at minimum wage when employees’ daily shifts are longer than 10 hours.These retail operations failed to provide adequate uniforms for employees for the number of shifts in a week, and also failed to pay the required uniform laundry allowance.In addition to payment of $469,355 in back wages and liquidated damages, the franchisees which remain open must also institute complaint procedures and post a statement of employees’ rights.

"Employers who underpay their employees not only deprive workers of the funds needed to buy their food, pay their rent or attend to other necessities, they undercut those law-abiding employers who pay their employees properly in the first place. Although franchising is a legitimate business model, it can also be associated with practices that lead to violations of labor standards. Franchisees must understand that they are not exempt from the law,” said Dr. David Weil, administrator for the Wage and Hour Division at the U.S. Department of Labor.

October 16, 2015

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