"Lenny's: The Ultimate Settlement"

Department of Labor Investigation Finds NYC Restaurant Must Pay Workers Over $5 Million in Back Wages

Governor Cuomo today announced that the New York State Department of Labor (DOL) has reached a $5.1 million settlement with New York City-based "Lenny's: The Ultimate Sandwich" (Lenny's) for minimum wage and overtime violations affecting over 800 workers. This settlement is the largest recorded settlement for workers in the DOL's 110-year history.

"It is our duty to protect hard-working New Yorkers and ensure that they receive every dollar that they earn," Governor Cuomo said.

"This settlement – the largest recorded settlement for workers in the history of the Department of Labor – sends a strong message to employers that exploiting employees will not be tolerated in New York State. I thank the Department of Labor for their efforts on behalf of workers across the state."

Lenny's is a New York City-based sandwich chain with several locations. From 2002 to 2008, over 800 employees from eleven locations were cheated out of millions of dollars. The DOL's investigation found that employees were regularly paid less than the minimum wage and were not paid overtime wages.

Employees worked 10 to 12 hours a day, six to seven days a week, at an average weekly salary of $275 per week. As required under the state’s minimum wage and overtime law, however, the workers should have been paid at least $500 per week for the same number of hours worked. In addition, time records kept by the employer were not accurate and wage statements were not provided to workers, as required by law.

As a result of this investigation, the DOL has reached a $5.1 million settlement with Lenny's for wages, damages, and penalties. The DOL has received a $1 million down payment and Lenny's will pay the remaining $4 million in full over the next twenty-four months. Lenny's is paying $100,000 in penalties to the state. Employees will receive the first installment of their unpaid wages beginning in June 2011.

New York State's minimum wage is now $7.25 per hour. Employers are required to pay overtime for weekly hours past 40 at 1.5 times the employee's regular pay rate.

This investigation was conducted by Senior Investigator Cloty Ortiz under the supervision of Supervising Investigator Maritza Lamboy.

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