Pagliacci Pizza to pay nearly $ 4 million in class action lawsuit
Pagliacci Pizza – one of Seattle’s most iconic restaurant chains – recently settled a multi-million dollar class action lawsuit filed in 2017 on behalf of former and current delivery drivers. Lead plaintiff, former delivery driver Stephen Burnett, alleges Pagliacci routinely violated Washington labor laws by failing to properly disclose to customers where delivery charges went, improperly distributing tips, failing to pay not car-related expenses, failing to provide adequate rest and meal breaks, and making illegal deductions from Burnett’s paycheck.
Burnett delivered pizzas for Pagliacci from 2015 to 2017, but the allegations in the lawsuit cover all those employed as drivers from October 3, 2014 to January 26, 2021. In order to settle the case, the chain will pay $ 3,750,000 to 1 012 class action members (which equates to approximately $ 3,700 per person).
Among the main allegations in the lawsuit were that Pagliacci regularly instituted automatic delivery charges, but did not distribute those funds to delivery drivers, and the restaurant also did not reveal to customers where the money was going, as required by the law. Washington law. Pagliacci’s defense to this allegation is that customers who ordered over the phone did not receive menus and rarely received receipts, and the restaurant maintains that customers were told verbally that the delivery charge was not. been paid to the drivers, either when placing their orders by telephone, or by the drivers themselves.
Regarding tips, the complainant claims that the chain failed to pay delivery drivers all the wages to which they were entitled by using mandatory “tips”, a procedure by which Pagliacci obliges delivery drivers to give part of their money. their tips to employees who do not deliver (such as kitchen staff).
Tip pools are not uncommon in restaurants and are legal in Washington state, as long as the restaurant pays full minimum wage and does not distribute such tips to exempt employees (such as managers). During the court proceedings, the plaintiffs and Pagliacci questioned whether it was legal to require delivery drivers to tip so-called “back-of-home” employees (such as kitchen staff). , and if the restaurant actually required such tip pooling at its Locations. For what it’s worth, state law doesn’t set limits on including delivery drivers in tips, as long as they’re paid minimum wage. Ultimately, part of the settlement was awarded to the alleged damages associated with the claim.
There were other compensation issues noted in the lawsuit, including the fact that Pagliacci allegedly deducted the credit card processing fee from the pay of delivery drivers (if a customer paid by card and wrote a tip on the receipt. , these charges would then be subtracted from the total. The lawsuit also alleges that the pizza chain made deductions for alleged customer complaints and failed to sufficiently compensate the car costs. On this last point, the lawsuit claims that the restaurant instituted a flat-rate reimbursement for each delivery trip, rather than taking into account the distance traveled. In addition, the complainant considers that he received no reimbursement for at least two “canceled” deliveries per month.
Regarding breaks, Pagliacci reportedly asked employees to choose options for “meal benefits” that fall outside of Washington’s labor laws, which require a ten-minute break for four hours of work and 30 minutes. meal breaks for five hours of work. The “Designed by Pagliacci” meal offer offered employees free food if they took meal breaks during paid breaks, just before or after a shift, or during an unpaid break. If employees wanted to take a 30-minute meal break, they had to “queue, order and pay. [the] food and drink like any other customer, ”says the lawsuit. So, it appears the restaurant tried to get employees to take fewer breaks in exchange for free food.
Pagliacci co-owner Matt Galvin denies the majority of the allegations listed in the lawsuit, but admits for a six-month period from 2016 that the restaurant did not disclose where the delivery service charges went on receipts or menus as required by state law. (This disclosure issue, he says, has since been resolved). Galvin also claims that in all of the annual employee surveys and meetings over the years, questions of rest and meal breaks have not been raised, and notes that on average, drivers earn $ 33 per l ‘hour, with benefits, and’ tend to stay. Galvin says he’s confident the company is following the letter of the law on “any matter of wages or hours,” but settling the lawsuit was more cost effective than enduring lengthy litigation. A final approval hearing of the settlement is scheduled for July 16.
Since opening its first store in U District in 1979, Pagliacci has grown to become one of the most dominant local independent pizza chains in the city. It has 24 locations in the Seattle area, including its headquarters on Capitol Hill, and its playful Ames Bros pizza box art has become as recognizable as the slices of Pagliacci over the decades. Although the company has mostly held steady during the pandemic, in July 2020 the chain closed its 32-year-old outpost at Queen Anne, the first location to start the delivery service. This follows the formwork of the original U District location in 2018 after 40 years. Pagliacci is still in the process of determining the full impact of the substantial legal costs of the lawsuit. “It’s tough for a company our size,” says Galvin. “But we are ready to move on.”
Pagliacci is the latest high-profile restaurant name in West Washington to settle a major work-related dispute. In 2019, Tom Douglas’s restaurant group paid employees $ 2.4 million after a class action lawsuit accused the restaurateur’s company of failing to properly disclose where the service charges were going and of failing to provide adequate breaks. More recently, The Willows Inn – Lummi Island’s renowned dining destination – settled a $ 600,000 lawsuit for alleged wage theft. In each case, the restaurants denied any wrongdoing.