Dive Brief:
- Owners and operators of 14 San Francisco Bay Area Subway restaurants have been ordered to pay employees nearly $1 million in back wages by the U.S. District Court for the Northern District of California, according to a U.S. Department of Labor press release.
- Investigators found that the operators told children as young as 14 and 15 to use “dangerous equipment and assigned minors to work hours not permitted by law,” the press release said. The investigation also found that the owners did not pay their employees regularly, issued hundreds of bad checks and kept tips left by customers.
- The court ordered the owners to sell or shut down their restaurants by Nov. 27, which the DOL said is a rare action.
Dive Insight:
The decision by the court to close the restaurants highlights the egregious nature of the violations. The DOL’s Wage and Hour Division found that owners John Michael Meza and Jessica Meza interfered with the division's review “by coercing employees not to cooperate and threatening children who raised concerns or tried to exercise their legal rights,” the press release said. The investigation also found that Hamza “Mike” Ayesh, an associate of the Mezas, partook in these violations, and threatened an employee who complained about a paycheck that bounced.
On Sept. 27, the Mezas were ordered to pay 184 workers $475,000 in minimum wage, overtime and tips and an equal amount in liquidated damages, according to the press release. They were ordered to pay a further $150,000 in penalties and both the Mezas and Ayesh were ordered to pay $12,000 in punitive damages for retaliatory conduct.
Wage and hour violations are not uncommon in the restaurant industry, which relies heavily on hourly workers rather than salaried employees. Over one-third of tipped workers said they experienced wage theft in the course of a year, according to a 2021 One Fair Wage report. Krispy Kreme settled overtime violations with the DOL last year with a $1.1 million settlement. In July, the DOL recovered $88,000 in wages from Detroit-based Joe Vicari Restaurant Group. Black’s Barbecue in Austin was ordered to pay $230,000 to a group of workers after the DOL found that workers were required to share tips with managers.
