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Chicago Dunkin’ Donuts Franchise Accused Of Systemic Wage Theft

In a new federal lawsuit, two former Dunkin’ Donuts employees claim Chicago franchise owner Sirajuddin Virani has been ripping off his employees for years.

Virani has committed numerous violations of wage and hour law, according to lead Plaintiff Christina Padilla, a shift supervisor who recently quit one of Virani’s downtown Chicago locations. In their complaint, Padilla and Jessica Zamudio say that during their tenure at Virani’s Dunkin’ Donuts shops, many employees worked more than 40 hours per week. Few, though, were paid overtime as required by federal and Illinois law, the lawsuit alleges.

Hours Fraud & Illegal Deductions, Workers Claim

The scheme was allegedly orchestrated by Virani’s “director of operations” Faisal Merchant. Plaintiffs say that Merchant instructed managers to alter the clock-in and clock-out times for employees who worked in excess of their scheduled shifts. That way, it would never look like anyone worked overtime at all.


Merchant also made illegal deductions from employee wages, the complaint contends. In reality, these deductions were meant to make up for cash register shortages, Plaintiffs claim, but on paychecks, the deductions were listed as “cash advance repayments.” Merchant never requested workers’ written authorization before deducting money from their wages, the complaint continues, which is required by federal law.

In some cases, Plaintiffs say these deductions were so hefty that workers weren’t even being paid Chicago’s minimum wage, currently $10.50 per hour.

Owner “Very Surprised” By Accusations

At a news conference held shortly after the lawsuit was filed, Padilla told reporters that Virani “seem[s] to rely on [a] revolving door of workers.” “We’re here to say that this can be such a better place to work,” she said, “if the workers get paid correctly, treated with respect, they will stay.” In a phone call with reporters at the Star Tribune, Virani said he was “very surprised” to hear the allegations, which he denied completely. “We follow all the rules and regulations and everything,” he told reporter Alexia Elejalde-Ruiz. “I don’t think that is a right comment from them. I don’t think it has ever happened like that.”

While Padilla’s complaint accuses Merchant of organizing the alleged wage violations, the lawsuit says Vasani was fully aware of the illegal behavior, but did nothing to stop it.

The lawsuit is seeking class action status, but due to the legal separation between parent companies and franchises, it’s likely that only employees who worked for Dunkin Donuts franchises owned by Virani would be able to join. Parent corporation Dunkin’ Brands is not named as a defendant in the case.

The lawsuit was filed on May 4, 2016 in the US District Court for the Northern District of Illinois, Eastern Division. It has been logged as case number 1:16-cv-04396.

Wage Theft Is Rampant In America’s Cities

Wage theft is particularly prevalent in urban centers like Chicago, with high concentrations of undocumented workers and historically under-served communities.

In 2010, a report from the University of Illinois at Chicago’s Center for Urban Economic Development found that of 1,140 surveyed workers, nearly 50% had been victim of a wage violation in the previous week. On average, the employees lost 16% of their potential earnings to wage theft. People of color, and specifically African-Americans were most at risk, experiencing wage violations 3 times more often than Latino workers and 27 times more often than white workers. Extrapolating the results of their study, the researchers estimated that employers stole over $7.3 million every week from front-line workers in low-wage jobs.

Similar issues were recently observed in Philadelphia. In a new analysis of Pennsylvania employment statistics, researchers at Temple University found that more than 125,000 low-wage workers in the Philly metro area experience a violation of minimum wage laws every workweek, while over 100,000 had their overtime rights violated.

Even more troubling, the state appears altogether incapable of enforcing wage and hour laws. Statistics obtained from Pennsylvania’s Department of Labor and Industry revealed that state regulators have been unable to collect any back-wages in over half of the complaints filed by employees.

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