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Post date: March 18 2014

A.G. Schneiderman Announces $500k Settlement With Seven Mcdonald's Restaurants In Manhattan

Owner Richard Cisneros And The Companies Must Pay Restitution To More Than 1,600 Workers For Unpaid Laundry Allowances, Uncompensated Work Time And Unlawful Wage Deductions

Schneiderman: We Will Enforce New York Labor Law In The Fast Food Industry

NEW YORK – Attorney General Eric T. Schneiderman today announced a settlement totaling almost $500,000 with seven New York City McDonald's restaurant franchises and their owner Richard Cisneros for failing to pay legally-required laundry allowances for many employees, for uncompensated work time and for unlawful deductions from wages that resulted when cashiers were required to cover cash register shortfalls. The settlement money, which includes damages and interest, will go to more than 1,600 mostly minimum wage workers who were shortchanged by these franchises.

The settlement is the second to come out of ongoing investigations of numerous fast food employers by the Attorney General’s Labor Bureau for labor law violations.  In December, the Attorney General secured reinstatement for twenty five workers at a Domino's pizza franchise located in Washington Heights, in New York City. 

“Like every other business in New York State, fast food employers must follow our labor laws,” Attorney General Schneiderman said. “Our lowest wage workers deserve the same protections of the law as everyone else. It’s critical, for them and for their families as well as for our economy, that we remain vigilant so that no New Yorkers are cheated out of their hard won earnings.”  

The seven restaurants, all in Manhattan, are located at 280 Madison Ave., 1499 3rd Ave., 1872-74 3rd Ave., 809 6th Ave., 427 10th Ave., 871 2nd Ave., and 18 East 42nd St.

Attorney General Schneiderman’s investigation found that from 2007 to July 2013, the Cisneros Group restaurants failed to pay certain of their 700 cashiers at the restaurants for time periods when they were required to work “off-the-clock” before and after some of their shifts.  The restaurants also required some cashiers to make up cash register shortages out of their own money when the registers were short of funds at the end of the workers’ shifts.  

In addition, when a business requires employees to wear uniforms like the ones in this case, New York law requires employers either to launder the uniforms, provide sufficient wash and wear uniforms for each day of the work week, or pay employees a "uniform maintenance allowance," in an amount set by law, in order to cover the employees' costs of laundering the uniforms.  However, Cisneros and his companies did not pay employees the uniform maintenance allowance required by law.  More than half of the settlement money will go to reimburse uniformed workers who were not paid this allowance as required.  Other violations included failure to pay workers an extra hour of pay at minimum wage when they worked more than 10 hours in a day, as required by New York law.

The Attorney General thanks New York Communities for Change, which referred worker complaints to his office.

Jonathan Westin, executive director of New York Communities for Change, said, “I want to commend Attorney General Schneiderman for investigating the owner of seven McDonald's franchises for what amounts to wage theft. This money will go to workers who should have received it in the first place. This settlement, and the $3.9 million settlement the Attorney General reached earlier this month for car wash workers, is a clear signal that unscrupulous owners will not be tolerated and that we will continue to fight on behalf of these workers. McDonald's must ensure that its franchise holders abide by the law and treat workers fairly.”

Further information about Attorney General Schneiderman’s settlement with car wash owners can be found here.

In addition to paying the restitution funds, the settlement with the Attorney General also requires the seven franchises to submit to monitoring of their labor law compliance. The Cisneros Group restaurants will also institute complaint procedures, provide bilingual written handbooks to employees, train supervisors on the labor law, and post a statement of employee's rights.

A claims administrator overseen by the Attorney General’s Office will determine how much each of the more than 1,600 employees will be reimbursed, depending on the specific employment facts of each employee. The restaurants do business as ERC Food Corp., Angel 3rd Avenue Corporation, Anghec, Inc., Angel 10th Ave. Food Corporation, JHC Corp., EJJ Food Corp., and John C Food Corp.

The case was handled by Assistant Attorney General Elizabeth Wagoner and Special Counsel Patricia Kakalec in the Attorney General’s Labor Bureau, which is led by Bureau Chief Terri Gerstein.  Executive Deputy Attorney General for Social Justice is Alvin Bragg.

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