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Cheesecake Factory held jointly liable with contractor for $4.2 million in janitorial wage theft case

Cheesecake Factory held jointly liable with contractor for $4.2 million in janitorial wage theft case
A state investigation found that janitors at eight Southern California Cheesecake Factory restaurants worked without proper rest or meal breaks. Above, a Cheesecake Factory in Chicago. (George Rose / Getty Images)

In a case that could prove to be a model for holding businesses responsible for abuses by their contractors, the Cheesecake Factory Restaurants Inc. chain has been found jointly liable with a janitorial services firm for wage theft violations totaling $4.2 million, the California Department of Industrial Relations said Monday.

California Labor Commissioner Julie Su said the wage theft citation was the largest she knows of in the janitorial industry. “We do feel that this is a significant step in sending a message about abuse of contractors and subcontracted workers,” Su said in an interview.

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Cheesecake Factory said in a statement that it takes “matters of this nature very seriously” and it is continuing to “review the allegations and will respond to the wage citation within the time provided.”

Cheesecake Factory had a contract with Americlean Janitorial Services Corp., which provided workers to the restaurant from subcontractor Magic Touch Commercial Cleaning.

An 18-month investigation by Su’s office found that janitors at eight Southern California Cheesecake Factory restaurants — in Brea, Irvine, Huntington Beach, Newport Beach, Mission Viejo, Escondido and San Diego — worked without proper rest or meal breaks. Each worker also logged up to 10 hours of unpaid overtime each week because the workers were not allowed to leave after their eight-hour shift until a Cheesecake Factory kitchen manager reviewed their work, which would “frequently lead to additional tasks” the workers had to complete, according to a statement issued by state officials.

The citations were issued under a 2015 California law that says employers that rely on subcontractors for labor can be held liable for those subcontractors’ workplace violations. Another state law, which went into effect in 2016, specifically states that businesses contracting for property services — including janitorial, security guard and gardening services — are to be held jointly liable for any unpaid wages.

The Cheesecake Factory action “was a test case and designed to be an exemplar for employers to make sure they don’t contract or subcontract to unscrupulous actors,” said Tia Koonse, legal and policy research manager at the UCLA Labor Center.

The 559 workers are owed a total of $3.94 million in minimum wages, overtime, meal and rest period premiums, among other damages. Cheesecake Factory and its janitorial contract firm Americlean are jointly liable for $4.2 million. Subcontractor Magic Touch is also liable for part of that amount.

Su said she hoped the case would incentivize businesses to contract with “the many good, honest businesses in California that play by the rules.”

Maria Lugo, 52, said she worked as a janitor at a San Diego Cheesecake Factory for subcontractor Magic Touch. She said she would clean the restaurant for nine to 10 hours a night.

Lilia Garcia-Brower, executive director of the Maintenance Cooperation Trust Fund, which represented workers who participated in the labor commissioner’s investigation, said she hoped the case would ensure companies such as Cheesecake Factory made sure that their contractors were obeying the law.

“Since they now are being forced into the conversation by being named, they now have legal liability,” she said. “Workers don’t want to be in a dispute, employers don’t want a dispute. What they both want is a fair workplace.”

5:25 p.m.: This article was updated with information from California Labor Commissioner Julie Su, UCLA researcher Tia Koonse and Lilia Garcia-Brower, executive director of the Maintenance Cooperation Trust Fund.

This article was originally published at 12:05 p.m.

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