Panera Bread Company has agreed to pay $5 million in order to settle two putative class action lawsuits filed by former restaurant workers who allege that the company failed to pay them overtime and forced them to work without pay during their meal breaks.
According to regulatory filings with the Securities and Exchange Commission (SEC), Panera has allocated funds to be used for the settlement agreement after reaching a deal with the former employees last week. Panera denies any wrongdoing or liability in the lawsuits.
The first of the legal actions was brought by Nick Sotoudeh who filed suit against Panera in California Superior Court in 2009. Sotoudeh claims that Panera refused to pay him overtime, failed to provide meal and rest breaks and further alleged that Panera violated state labor and unfair competition laws. Another former employee, Gabriela Brizuela, was added to Sotoudeh’s amended complaint later that year.
Ms. Brizuela claims that she routinely worked more than 8 hours daily and 40 hours weekly and did not receive appropriate overtime compensation. Additionally, Ms. Brizuela alleges that Panera forced her to work during her meal and rest breaks to which she and other employees are entitled under California state law. Prior to the settlement with Panera, Ms. Brizuela sought to form a class action lawsuit comprised of employees who worked at Panera restaurants in California since 2007.
The second suit addressed by the recent settlement agreement was brought by two former employees against Panera in San Bernadino County Superior court in July 2011 and made similar allegations.
The California Superior Court would have to approve the settlement before it would go into effect, but according to Panera’s filings with the SEC, the company has reserved $5 million for the claims.