The US Department of Labor may soon be run by the CEO of a company cited by the agency itself for wage and labor violations, and sued by employees for more of the same last week.
Andrew Puzder, a critic of minimum wage increases and US president Donald Trump’s nominee to run the Department of Labor, has been named in a lawsuit filed by restaurant workers in Los Angeles Superior Court on Feb. 8. The lawsuit alleges that CKE Enterprises—parent company of the Carl’s Jr. and Hardee’s fast-food chains, with Puzder as its CEO—engages in unfair business practices to suppress worker wages.
The suit was filed by one former and one current Carl’s Jr. employee, who are together seeking class-action status on behalf of similarly situated workers. They argue that their claims are representative of systemic violations arising from CKE’s use of “no hire” agreements between franchisees, which prevent workers from bargaining for raises.
Luis Bautista and Margarita Guerrero say that their pay at a Carl’s Jr. restaurant in Los Angeles was “atrocious” because of the no-hire clause. They argue that the prohibition on hiring CKE workers between franchises suppresses competition on the free market by reducing worker bargaining power in violation of labor laws.
Their lawyer, Nina DiSalvo, told the LA Times she believes the sole justification for the “no hire” practice “is to actively reduce labor costs to save [CKE] money.”
CKE responded with a statement, declining to comment on the allegations but calling the timing of the case suspect. “[T]his baseless lawsuit is obviously intended to be an attempt, albeit a feeble one, to derail the nomination of Andy Puzder,” says Charles Seigel, a lawyer for CKE. “The plaintiffs and their backers will succeed at neither.”
But the labor lawsuit is just one of Puzder’s problems. If his nomination as Labor secretary is derailed, it probably won’t be because of this case.
Though most of Trump’s cabinet already has been confirmed, Puzder’s Senate confirmation hearings have been delayed, with Congress waiting on him to file the appropriate paperwork. And last week, Puzder admitted to having an undocumented immigrant working as his housekeeper. He issued a statement explaining that he didn’t know her immigration status then and and has since paid all back-taxes owed.
Meanwhile, Democrats remain deeply skeptical of his qualifications and his policy intentions, and even some Republicans have yet to be sold on his qualifications. On Feb. 13, The Washington Post reported that “at least four GOP senators are on the fence about” the nominee.
He’ll presumably get a chance to persuade them at his confirmation hearing, which is now scheduled for Feb. 16.