Domino’s Pizza sued for systemically underpaying employees

The state's attorney claims the company knowingly underpayed employees at 10 New York pizza shops.

A pie from Dominoes Pizza in Brooklyn, New York. (TAKA@P.P.R.S/Flickr)

New York’s attorney general has accused Domino’s Pizza of systematically underpaying its employees.

Announcing the lawsuit on Tuesday, New York Attorney General Eric Schneiderman said that Domino’s Pizza LLC, one of the largest pizza chains in the country, has displayed a pattern of shortchanging low-wage workers.

"We've uncovered rampant wage violations at Domino's franchise stores, and intensive involvement by Domino's headquarters that caused many of these violations," Attorney General Eric Schneiderman said during a press conference. "At some point, a company has to take responsibility for its actions and for its workers' well-being.”

Schneiderman’s lawsuit claims that since 2007 the company knew its payroll software undercalculated wages while encouraging its franchisees to continue using it, underpaying employees $565,000 at 10 New York pizza shops.

“At some point, a company has to take responsibility for its actions and for its workers’ well-being. We’ve found rampant wage violations at Domino’s franchise stores. And, as our suit alleges, we’ve discovered that Domino’s headquarters was intensely involved in store operations, and even caused many of these violations,” said Attorney General Schneiderman.

New York’s attorney general previously won a lawsuit against 23 Domino’s Pizza outlets in 2014 for wage theft, securing $448,000 for workers, The New York Times reports. The chain also settled a class-action lawsuit that reeled in $1.3 million for wage violations in the city.

“Under these circumstances, New York law – as well as basic human decency – holds Domino’s responsible for the alleged mistreatment of the workers who make and deliver the company’s pizza. Domino’s can, and must, fix this problem.”

Domino’s responded to the lawsuit shortly after it was filed in the state's Supreme Court in Manhattan.

“We were disappointed to learn that the attorney general chose to file a lawsuit that disregards the nature of franchising and demeans the role of small business owners instead of focusing on solutions that could have actually helped the individuals those small businesses employ,” the pizza chain said in a statement to The Times.

“We believe that every employee deserves to be treated fairly and paid what they are entitled to under the law. We also believe that franchising is a tremendous source of economic opportunity in this country in general and in New York State in particular.”