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National Wage and Hour Clearinghouse

New York Papa John's Franchise Owner To Pay $2.1 Million to Resolve Pay Case

Friday, March 06, 2015

A New York City Papa John's franchise owner has been served with a $2.1 million judgment for back wages, damages and other amounts for underpaying hundreds of delivery workers at five Harlem pizza restaurants, state Attorney General Eric T. Schneiderman (D) announced March 5 (New York v. New Majority Holdings LLC, N.Y. Sup. Ct., No. 452487/2014, order and judgment3/3/15).  In a March 3 judgment, Justice Joan M. Kenney of the state Supreme Court for New York County ordered New Majority Holdings LLC, a Papa John's pizza franchisee, and its owner and operator, Ronald Johnson, to pay $2,126,166 in owed wages, unreimbursed expenses, liquidated damages and interest.  Money recovered under the judgment will be distributed to workers by the state, according to its terms. The order also requires that proceeds from any sale of New Majority's stores go to the attorney general's office and requires the company to comply with the state Labor Law.

The settlement was part of a fast-food wage enforcement drive by Schneiderman. The drive resulted in an $800,000 judgment in late January against another New York City Papa John's franchise owner (22 DLR A-9, 2/3/15).  “Within the last two months, courts have found that two Papa John's franchisees owe almost $3 million to their workers,” Schneiderman said in a statement. “We will continue to investigate wage and hour violations in the fast food industry.”
Schneiderman continued: “More broadly, franchisors need to step up to the plate. I call on all fast food franchisors, including Papa John's, to take steps necessary to ensure that their workers—the backbone of their business—are treated fairly and paid the wages the law requires.”
According to the attorney general, the investigation found that New Majority and Johnson rounded down hours worked to the nearest whole-hour increment and paid nothing for fractions of hours. (click on link to read full story) 

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