California Labor Commissioner Receives $1.7 Million Settlement in Wingstop Wage Theft Case

The California Office of the Labor Commissioner has reached a $1.7 million wage theft settlement for 550 workers in an alleged scheme in which the owner of several Bakersfield Wingstop locations created separate corporate entities to circumvent labor laws.

The franchisee must now pay $5 for every $1 that was originally owed. The LCO announcement follows a state investigation that uncovered a scheme in which a franchisee disguised ownership of five Wingstop locations to deprive employees of wages, overtime and meal breaks.

The LCO began its investigation in 2020 after receiving a labor law violation reported for one of the locations. The investigation revealed that between 2019 and 2022, five Wingstop companies each operated as separate corporate entities, although one owner, Clinton Lewis, operated each site and divided employees between multiple locations. By treating each location as a separate employer, Lewis was able to pay workers the lower minimum wage designated for smaller employers with 25 or fewer employees.

Employees scheduled to work more than one Wingstop in a day were reportedly denied overtime pay when they worked more than eight hours in a workday or 40 hours in a workweek. Lewis avoided paying premiums for missed meal breaks to staff when scheduling them across multiple locations. Additionally, employees were not compensated for time off work while traveling from one location to another, according to the LCO.

This settlement resolves claims that covered minimum wage violations, contract wage violations, meal period premiums, liquidated damages, and waiting time penalties. Today’s agreement is an update from a previous announcement.

TOPICS
Fraud in California