The owners of 23 Domino's Pizza restaurants in New York will pay $448,000 to minimum-wage workers who were underpaid, according to a settlement announced by the state's attorney general.
The six franchisees have pizzerias in New York City and Dutchess, Erie, Nassau, Rockland, Schenectady, Suffolk and Westchester counties. They signed settlements listing various wage violations. The settlement money will be distributed among approximately 750 employees. Most are expected to get back between $200 and $2,000.
Investigators reported numerous violations of labor laws by the franchise owners from 2007 to 2013.
"The violations in these cases demonstrate a statewide pattern of Domino's franchisees flouting the law and illegally chiseling at the pay of minimum-wage workers, who struggle to survive," Attorney General Eric Schneiderman said Thursday. "My office will be relentless in pursuing fast-food employers who underpay the hardworking people who are the backbone of their operations."
Violations included paying delivery workers as little as $5 an hour, lower than the $5.65 state minimum wage for tipped workers in effect since 2011. According to the attorney general's office, two owners failed to pay adequate overtime, while others underpaid it by not combining all hours worked at multiple stores or by using the wrong formula. Also, delivery workers weren't fully reimbursed for using their own cars, those who rode bicycles typically got no maintenance reimbursements or protective gear as required by New York City law, and some stores paid the lower minimum wage for tipped workers who spent less than 80 percent of their shifts on tipped work as required.
Investigators also found some stores violated the state requirement to pay an additional hour at minimum wage when employees' daily shifts are longer than 10 hours. Some violated the requirement to pay restaurant workers for at least three hours when they report to work for a longer shift but are ultimately sent home early because of slow business or other reasons.
Khaled Handan, one of the owners of a Domino's in Amherst, which faces a $40,000 settlement, said they use a payroll company and there was confusion over the rate for delivery drivers when the minimum wage increased. There was also confusion in calculating overtime and subtracting for tips. "We didn't know," he said.
Under the settlements, the franchisees must also institute complaint procedures, provide bilingual employee handbooks, train supervisors on the labor law, post statements of employee rights and make quarterly compliance reports for two to three years.
Two franchisees also are required to hire an independent monitor to make unannounced inspections.
Investigations of other Domino's franchises are ongoing by the attorney general's Labor Bureau.
Last week, the office announced a $500,000 settlement with a New York City McDonald's franchisee and in December got 25 workers reinstated at a Domino's Pizza franchise in Manhattan.