Papa John’s Franchisee Settles with New York AG for Cheating Workers Out of Pay

New York Attorney General Eric T. Schneiderman announced Friday that his office had reached a $170,000 settlement with a Papa John's franchisee in Brooklyn that will allow 100 underpaid workers restitution and damages.

To date, The AG has obtained more than $4.5 million in settlements and court judgments at more than 35 of the chain's pizza locations for hundreds of workers.

Sandeep Singh owns the three Papa John's locations and was accused of violating minimum wage and overtime requirements, and of taking unlawful deductions from workers' wages by failing to reimburse all work-related expenses. The franchisee must also institute complaint procedures, provide written handbooks to employees, train supervisors on the labor law, post a statement of employees' rights, and designate an officer to submit quarterly reports to the Attorney General's Office regarding ongoing compliance. Schneiderman's office began its investigation into franchisee Sigh's operation in 2013.

"Today's settlement underscores a shameful track record of New York Papa John's franchisees cheating vulnerable workers to line their own pockets," said Attorney General Schneiderman. "With this agreement, my office has won back more than $4.5 million for hundreds of underpaid Papa John's employees. We will continue to defend the rights of all workers and fight pervasive wage theft in the fast food industry."

Over the past two years, the AG office found violations by eight separate Papa John's franchisees, who together, operated a total of over 30 restaurants. In one case, the franchisee, Abdul Jamil Khokhar, owner of nine pizza restaurants, pled guilty to charges of failing to pay workers minimum wage and overtime, and was sentenced on September 21, 2016 to serve 60 days in jail and pay $230,000 in restitution to his staff. The U.S. Department of Labor also filed a consent judgment against his company in federal court, and recovered an additional $230,000 as liquidated damages from him and his company, and civil money penalties of $50,000.

Schneiderman's latest settlement not only included violations of federal Fair Labor Standards Act and state law, for not paying overtime wages to employees, but also violations of New York State's "spread of hours" regulations where workers were not paid additional hours at minimum wage when their daily shifts were long than 10 hours. Another violation was not reimbursing workers for the cost of uniforms they were required to wear while working.

Papa John's Pizza is not the only franchise fast food chain AG Schneiderman has been going after. Franchisees of Domino's and McDonald's have also had to pay hefty amounts for violations of minimum wage and overtime regulations. In October 2014, the Attorney General vowed to continue his quest to protect workers' rights. "Nobody who works 40 hours a week should have to live in poverty. Like every other business in New York, fast food employers must follow the law." Schneiderman said his office will combat wage theft whenever and wherever they see it in order to protect the rights of hardworking New Yorkers.

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Janet Sparks