Legal Issues

NYC Papa John's Pizza Franchisee Sued for $2 Million

New York state's attorney general sued the owners of five Papa John's pizza restaurants in Manhattan on Thursday for about $2 million over claims that they had underpaid 400 delivery workers and shaved hours from their paychecks.

The lawsuit comes amid a national debate over minimum wage laws that has sparked protests by fast-food employees and prompted cities across the United States to propose wage hikes for their lowest-paid workers.

"Nobody who works 40 hours a week should have to live in poverty," Attorney General Eric Schneiderman said in a statement. "My office will combat wage theft whenever and wherever we see it in order to protect the rights of hardworking New Yorkers, including pizza delivery workers and others who toil at fast-food restaurants."

The lawsuit was filed in the State Supreme Court in Manhattan and names Papa John's pizza franchisee New Majority Holdings LLC, and its owner, Ronald Johnson, as defendants.

It seeks over $2 million in damages, about half of which is restitution for suspected unpaid wages.

Attempts to reach a representative from New Majority Holdings or Johnson on Thursday were unsuccessful.

Restaurant workers at New Majority's five Papa John's outlets, which are all in Manhattan, received pay for fewer hours than they actually worked, the lawsuit claims.

It also claims that some employees were given as little as $5 an hour, less than the $7.25 per hour that was required for most of the time period covered by the lawsuit.

The lawsuit is the result of a year-long investigation by the state attorney general's Labor Bureau into New Majority's pay practices.

The company is the first to be sued in the bureau's ongoing investigations of multiple fast-food employers. 

(Reporting by Laila Kearney; Editing by Jonathan Allen and Eric Beech)

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