A.G. Schneiderman Announces $170,000 Settlement With Papa John's Pizza Franchisee For Failing To Pay Workers

News from Attorney General Eric T. Schneiderman

FOR IMMEDIATE RELEASE
January 5, 2018

Attorney General’s Press Office / 212-416-8060
nyag.pressoffice@ag.ny.gov
Twitter: @AGSchneiderman 

A.G. SCHNEIDERMAN ANNOUNCES $170,000 SETTLEMENT WITH PAPA JOHN’S PIZZA FRANCHISEE FOR FAILING TO PAY WORKERS

Sandeep Singh, Owner of Three Brooklyn Papa John’s Restaurants, Will Pay Full Restitution To Over 100 Employees

To Date, Attorney General Schneiderman Has Obtained More Than $4.5 Million In Settlements And Court Judgments For Hundreds Of Workers At More Than 35 Papa John’s Franchise Stores

In Total, the Attorney General Has Won Back Nearly $30 Million in Stolen Wages for Over 21,000 Workers Across New York

BROOKLYN – Attorney General Eric T. Schneiderman today announced a settlement with Sandeep Singh, Star Fine Foods, Inc., Star Fine Foods II, Inc., and Star Fine Foods IV, Inc., the owners of three Papa John’s Pizza franchise stores in Brooklyn, NY. The three locations violated minimum wage and overtime requirements, and took unlawful deductions from workers’ wages by failing to reimburse all work-related expenses. In total, Singh will pay $171,895.12 in restitution and damages to over 100 underpaid workers.

“Today’s settlement underscores a shameful track record of New York Papa John’s franchisees cheating vulnerable workers to line their own pockets,” said Attorney General Schneiderman. “With this agreement, my office has won back more than $4.5 million for hundreds of underpaid Papa John’s employees. We will continue to defend the rights of all workers and fight pervasive wage theft in the fast food industry.”

Two of the stores involved in today’s settlement are located at 1016 Coney Island Avenue and 5804 5th Avenue in Brooklyn. The store owned by Star Fine Foods IV, Inc., located at 1612 Neptune Avenue, is no longer in operation.

Today’s agreement follows an investigation into the franchisee, beginning in 2013. Singh admitted to the violations of law outlined in the settlement agreement. The admitted violations included the following:

  • Workers were not paid the overtime wages required under the federal Fair Labor Standards Act and state law;
  • Workers were not paid an additional hour at minimum wage when employees’ daily shifts were longer than 10 hours, violating New York State’s “spread of hours” regulations; and 
  • Workers were not reimbursed for the cost of uniforms that they were required to purchase and wear. 

In addition to paying $171,895.12 in restitution and damages, the remaining two stores operated by Singh must also institute complaint procedures, provide written handbooks to employees, train supervisors on the labor law, post a statement of employees’ rights, and designate an officer to submit quarterly reports to the Attorney General's Office regarding ongoing compliance.

In total, Attorney General Schneiderman has won back nearly $30 million in stolen wages for over 21,000 workers across New York. This includes more than $4.5 million in settlements and court judgments for hundreds of workers at more than 35 Papa John’s franchise stores.

Over the past two years, the Attorney General's Office has investigated and found violations by eight separate Papa John’s franchisees, who, together, operated a total of over 30 restaurants, including:

  • Moregrace LLC, Thegrace, Inc. and its owner, Sultan Ali Lakhani paid $500,000 in restitution and liquidated damages. Lakhani owned and operated three stores at 701 W. 179th Street in Washington Heights, 4927 Broadway in Inwood, and 161 West 231st Street in the Bronx.
  • Syed Mehboob and his stores paid $400,000 in restitution and liquidated damages. Mehboob owned and operated six individually incorporated franchise restaurants in Queens: 3320 Woodside Papa, Inc. (operating at 49-19 30th, Woodside, New York 11377), 99 Food, Inc. (operating at 9906 Northern Blvd., Corona, New York 11369), Sunnyside Papa, Inc. (operating at 40-12 Greenpoint Ave., Sunnyside, New York 11104), Zeeshee, Inc. (previously operated at 23-33 Astoria Blvd., Astoria, New York 11102; closed in March 2015), 193 Papa, Inc. (previously operated at 193-18 Northern Blvd. Flushing, New York 11358; sold in November 2014), and Parson Papa, Inc. (previously operated at 147-14 45th, Flushing, New York 11355; closed in November 2014). The settlement included restitution for violations from August of 2008 to August of 2014.
  • AMHC Food Inc. and its owner Mohammed Hasnat, operators of a Papa John’s restaurant at 2241 Westchester Avenue in the Bronx, New York, paid $40,000 in restitution and liquidated damages. The settlement included restitution for violations from January of 2014 to July of 2015.
  • Ksara Corp. and owner Ghulam Fani, operators of a Papa John’s restaurant at 189 Avenue U in Brooklyn, New York. The settlement with Ksara also included Zeman Associates, LLC, a prior owner of this franchise. These operators paid $16,000 in restitution and liquidated damages. The settlement included restitution for violations from February of 2013 until July 2015.
  • Judy & Jesenia, Inc. and owner Jesenia Diaz, who until November 2014 operated a Papa John’s restaurant located at 3528 Nostrand Avenue in Brooklyn, New York paid over $13,000, in restitution and liquidated damages for underpayments beginning in June of 2013 through November of 2014.
  • In February and March of 2015, Attorney General Schneiderman obtained judgments against two other Papa John’s franchisees, Emstar Pizza (6 locations) and New Majority Holdings (5 locations), for violating wage laws. Those judgments totaled almost $3 million.
  • In addition, in July of 2015, the Attorney General arrested Abdul Jamil Khokhar, the owner of nine Papa John's Pizza franchises in the Bronx, and his company, BMY Foods, Inc. for failing to pay workers minimum wage and overtime. Khokhar and BMY Foods pled guilty to these charges and were sentenced on September 21, 2016. Mr. Khokhar and BMY Foods, Inc. were ordered to pay $230,000 in restitution to workers, and Mr. Khokhar was sentenced to serve 60 days in jail. The U.S. Department of Labor also filed a consent judgment against the enterprise in federal court, and recovered an additional $230,000 as liquidated damages from Khokhar and BMY Foods, and civil money penalties of $50,000.

The Attorney General’s investigation was handled by Assistant Attorney General Kevin M. Lynch of the Labor Bureau, under the supervision of Mayur Saxena, Civil Enforcement Section Chief, and Julie Ulmet, Deputy Bureau Chief. ReNika Moore is the Labor Bureau Chief and Alvin Bragg is the Chief Deputy Attorney General overseeing the Division of Social Justice.

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