The Cheesecake Factory Settles California Janitors Wage Theft Lawsuit

January 29, 2024, 10:30AM. By Jane Mundy

The Cheesecake Factory has settled for $1M its California wage theft case from 2018 when the restaurant chain was accused of stiffing hundreds of janitors of overtime pay and breaks.

Santa Clara, CAIf you worked as a janitor at any of eight Cheesecake Factory restaurants in Orange and San Diego counties and were forced to work overtime and/or worked through breaks between 2014 and 2017 without being compensated, the California’s Labor Commissioner’s Office is handing out checks to ex-employees of the restaurant chain and wants to hear from you.

In a 2018 news release, the state’s Labor Commissioner’s Office determined (after its investigation began in 2016) that 559 janitorial workers working at the restaurant chain had been underpaid and slammed it with a $4.57 million California labor wage theft case. Because Americlean Janitorial Services Corp. had subcontracted the work to Magic Touch Commercial Cleaning, it was also liable for wage theft at eight locations. The affected workers were due $3.94 million. That amount was calculated after investigators audited the payroll of the previous three years to determine minimum wage, overtime and other labor law violations, and calculated payments owed and penalties due. When workers are paid less than minimum wage, they are entitled to liquidated damages that equal the amount of underpaid wages plus interest. As well, they are entitled to waiting time penalties when the employer intentionally fails to pay all wages due to the employee at the time of separation. This penalty is calculated by taking the employee’s daily rate of pay and multiplying it by the number of days the employee was not paid, up to a maximum of 30 days. Clearly, wage theft doesn’t pay. 

Wage Theft Investigation

The investigation began after the Labor Commissioner’s Office received a wage theft report from the Employee Rights Center in San Diego, a non-profit group that assists low-wage workers without union representation. Cheesecake Factory workers who cooperated in the investigation were represented by a janitorial industry watchdog organization called the Maintenance Cooperation Trust Fund, which is a workers’ advocacy center that employs former janitors to investigate conditions in the industry.

Janitors were often working, and logging, up to 10 hours of unpaid overtime each week. They worked the nightshift: starting at midnight the Magic Touch janitors worked eight hours without proper meal or break periods and then were still on the clock when Cheesecake Factory kitchen managers conducted walkthroughs to review their work. The walkthroughs often led to more work that had to be completed until they were finished for the day, and that meant up to 10 hours of unpaid overtime each week.

Subcontractor Wage Theft

A 2015 law holds companies that hire janitorial contractors jointly responsible for workplace violations. So, Zulma Villegas, Magic Touch Commercial Cleaning owner, was ordered to pay $3,936,359 to the workers for unpaid minimum wages and overtime, liquidated damages, waiting time penalties and meal and rest period violations. The citations also included $632,750 for failure to provide properly itemized pay stubs and other civil penalties.

Because Cheesecake Factory contracted with the national Americlean Janitorial Services Corp. to clean its restaurants and Americlean in turn subcontracted the work in the eight southern California locations to Magic Touch, according to the state, Americlean was also on the hook. By the time it all came out in the wash, the settlement agreement in October 2023 was signed for only one-fourth of the initial citation amount.

Regulators agreed to reduce the amount owed to finally resolve the case. One worker, Naxhili Perez told KQED News that she worked polishing floors for $70 a day but often worked longer than 10 hours. To make ends meet, the 41-year-old mom of four worked a second job cleaning homes. “That’s what they [regulators] were able to achieve because this was going to drag on…I am thankful to all the people that have helped us. If the Labor Commissioner hadn’t gotten involved, we’d all be in the same situation.”

Seeking Janitorial Workers

According to the Orange County Register, janitors who worked at Cheesecake Factory restaurants in Brea, Irvine, Huntington Beach, Newport Beach, Mission Viejo, Escondido and San Diego between Aug. 31, 2014 and Aug. 31, 2017 are asked to call 619-213-5260.