On Wednesday, the owner of nine Papa John’s franchises in New York City pled guilty to the first criminal case brought by New York Attorney General Eric Schneiderman against a fast food franchisee over wage theft.
According to court documents, including company records obtained by the attorney general’s office, Abdul Jamil Khokhar, the franchisee, and BMY Foods Inc. paid its 300 current and former workers the same base rate for any hours they worked after putting in 40 a week, which under law should be paid time-and-a-half. To get away with paying less, they allegedly paid overtime hours in cash and created fake names for the employees in the timekeeping system. They then filed fraudulent tax returns that left out the cash payments made to employees under the false names.
Khokhar’s sentencing is set for September 21, when he faces 60 days in jail. He also faces paying the employees $230,000 in back wages as well as an additional $230,000 in damages and $50,000 in civil penalties.
BMY Foods Inc. declined to comment. A Papa John’s spokesperson said in an emailed statement, “Papa John’s is aware of the recent incident involving one of our New York franchisees who was taken into custody this morning. These allegations do not reflect our position as a company. We have a strong track record of compliance with the law. We do not condone the actions of any franchisee that violates the law. This particular franchisee has divested itself of most of its restaurants and is in the process of exiting the system. We will continue to monitor the situation closely and take appropriate action.”
More of this. And Papa John’s itself needs to be held legally liable. Franchising exists in no small part so corporate doesn’t have to have any legal accountability for what happens in their stores. They control what they care about and let the little things like workers be on the backs on the franchisee. It’s a model that exists to help the corporation. One way it helps them is provide legal distance from the actual conditions of work. That has to change, and there has been recent signs that it is changing. We already know that Papa John’s CEO John Schnatter is a terrible human being who likes to keep his labor as poor as possible. I don’t know if Schneiderman can go farther up the food chain, but imprisoning a franchisee for wage theft is a good start.