Reminder: The states are looking at your pay practices, too

Just a reminder: It’s not just the feds who are on the lookout for wage and hour violators — it’s state authorities, too.  
Case in point: New York Attorney General Eric T. Schneiderman announced settlements totaling $970,000 with four current Domino’s Pizza franchisees, who together own 29 stores across New York State, as well as with one former franchisee who owned six stores. The franchisees admitted to a number of labor violations, including minimum wage, overtime or other basic labor law protections, according to Schneiderman’s office.
The admitted violations varied by location and time period, and included the following:

  • Some stores paid delivery workers below the tipped minimum wage applicable to delivery workers under New York law.
  • Some stores failed to pay overtime to employees who worked over 40 hours in a week, and others under-paid overtime, because they did not combine all hours worked at multiple stores owned by the same franchisee, or because they used the wrong formula to calculate overtime for tipped workers, unlawfully reducing workers’ pay.
  • Delivery workers who used their own cars to make deliveries were not fully reimbursed for their job-related vehicle expenses.
  • Delivery workers who used their own bicycles to make deliveries were typically not reimbursed for any expenses related to maintaining their bicycles, nor were they provided with protective gear as required by New York City law.
  • Some stores violated a state requirement that employers must pay an additional hour at minimum wage when employees’ daily shifts are longer than 10 hours.
  • Some stores also violated a state requirement that employers must pay restaurant workers for at least three hours of work when those employees report to work for a longer shift but are ultimately sent home early because of slow business or other reasons.
  • Some stores took a “tip credit” without tracking tips, and assigned delivery workers to kitchen or other untipped work for more time than legally permitted. Employers may only take a “tip credit” and pay a lower minimum wage to tipped restaurant employees if those employees earn enough in tips and spend most of their time – at least 80 percent –performing tipped work.

Schneiderman’s been on Domino’s case for a while. The recent agreements follow settlements announced last year with six Domino’s pizza franchisees, who together owned 23 stores and agreed to pay a total of $448,000 in restitution.