NEW YORK — A New York Papa John’s franchise has recently been ordered to pay more than $2 million for underpaying its employees. The New York federal judge who issued the order found the pizza restaurant franchisee to have shaved the hours of its delivery workers in violation of state and federal wage laws. The ordered judgment includes unreimbursed expenses, back wages, damages, and interest.
The Pizza Claim
In October 2014, the New York Attorney General Eric Schneiderman filed a lawsuit against the Papa John’s franchisee, New Majority Holdings, LLC. The franchise owner, Ronald Johnson, was included in the lawsuit and owns five restaurants in Manhattan. The Attorney General’s office began investigating the franchise in May 2013 after receiving complaints that delivery drivers were not receiving pay for all of the hours they worked. Delivery drivers are often tipped employees, who also incur costs related to the deliveries they make. In many cases, the automatic delivery costs added to an order only covers items like insurance or gas expenses and are not credited toward the driver’s tips.
Regardless of whether or not Papa John’s delivery drivers were tipped or non-tipped employees, they are entitled to compensation of at least minimum wage for every hour worked. The findings of the Attorney General’s investigation included evidence that the franchise regularly rounded down the delivery drivers’ hours and failed to pay its drivers the overtime to which they were entitled. Rounding down or shaving hours violates both state and federal wage laws, which require employers to maintain accurate records of hours worked.
Minimum Wage
In addition to rounding down, or shaving, the employee’s hours, the Papa John’s franchise was also found to have failed to pay at least the federal minimum wage of $7.25 an hour. Typically minimum wage violations occur when an employer appears to pay its employees minimum wage, but fails to pay for all of the hours worked. For instance, if an employee works 50 hours a week at $7.25 an hour, but is only paid for 40 hours per week, the employee is actually receiving $5.80 an hour in straight time. The failure to pay minimum wage is compounded when an employee works overtime and does not receive overtime pay at one and a half times their regular rate.
If you believe your employer is not paying you at least minimum wage for every hour you work or you are not receiving one and a half times your regular rate when you work overtime, you may have a wage or overtime pay claim. Time is limited for filing wage and overtime complaints so it is important to call today! Our experienced team of overtime pay lawyers can be reached at (855) 754-2795. Or you may complete our Free Unpaid Overtime Case Review form and our legal team will evaluate your claim. If we accept your case, we will represent you under our No Fee Promise. This means there are no legal fees or costs unless you receive a settlement.