On January 23, 2024, the California Labor Commissioner’s Office (“LCO”) announced that it reached a $1 million settlement with Cheesecake Factory and two janitorial labor contractors, Zully Villegas dba Magic Touch Commercial Cleaning and Americlean Janitorial Services Corp., dba Allied National Services, for allegedly underpaying 589 janitorial workers. In December 2016, janitors who worked at Cheesecake Factory restaurants complained about wage and hour violations to the LCO.
Labor Code section 2810.3 provides that the client employer and the labor contractor that a client employer contracts with to obtain workers from to perform labor within the client employer’s usual course of business are both liable for the workers’ wages and workers’ compensation.
Americlean Janitorial Services Corp., dba Allied National Services engaged Zully Villegas dba Magic Touch Commercial Cleaning, to provide janitorial services for the former’s client, Cheesecake Factory Restaurants, Inc. at several locations in Orange and San Diego Counties. All three entities were held liable under California Labor Code Section 2810.3 after receiving citations for unpaid minimum wages, unpaid overtime, liquidated damages and waiting time penalties, as well as meal and rest period premiums.
The case settled before going to hearing. Settlement terms also required that the labor contractors must provide prior wage claims information in their bidding process with Cheesecake Factory and provide janitors wage and hour trainings annually. Cheesecake Factory agreed to train their managers and people overseeing janitorial contracts to ensure compliance.