Dunkin’ Donuts Sues Franchisees Over Failure to Use E-Verify

Dunkin’ Donuts Sues Franchisees Over Failure to Use E-Verify

Dunkin’ (which recently changed its name from Dunkin’ Donuts) has sued several franchisees with nine locations in Delaware and Pennsylvania in federal court, seeking to stop them from running their Dunkin’ Donuts restaurants after their franchise agreements were terminated over failure to properly determine their employees’ eligibility to work in the United States. These lawsuits follow earlier such suits. In the past few months, Dunkin’ has filed at least three other lawsuits in federal court against franchisees arguing the operators failed to properly comply with seeking workers’ employment eligibility. In September 2018, Dunkin’ sued franchisees of five locations in Delaware alleging violations of employment law following the review.

Each of the lawsuits asserted Dunkin’ reviewed employment verification documents and practices, found violations at the subject franchisee companies, terminated the operators’ franchise agreements and moved to remove the franchisees from the restaurants.

According to Dunkin’s most recent lawsuits, it reviewed franchisees’ employment and tax records between January 2017 and October 2018 and found “pervasive noncompliance” with federal employment law. The complaint said there was “no employment documentation or incomplete documentation for a substantial portion of the employees’ files.” The company said franchisees frequently failed to use E-Verify to determine employees’ eligibility to work in the U.S., or only did so after being notified of the franchisor’s investigation.

According to Dunkin’, it makes clear in its franchise agreement with franchise owners, that owners must use E-Verify or risk losing control of their stores. Owners who don’t follow the rules, risk “sullying the coffee chain’s reputation … [when they] engaged in illegal hiring practices in breach of their contracts.” However, when a franchise is discovered to have not used E-Verify, Dunkin’ does not require employees to be reported to the Department of Homeland Security. Rather, punishment is made by terminating the franchise agreements for violating parts of their contract with Dunkin’.

Dunkin appears to be the first national retailer to terminate franchise agreements for failure to abide by immigration compliance after the announcement of the Trump administration’s plan to combat illegal immigration both on the nation’s borders and inside. If you want to know more information on issues related to employer immigration compliance, I recommend you read The I-9 and E-Verify Handbook, a book I co-authored with Greg Siskind, and available at http://www.amazon.com/dp/0997083379.

About The Author

Bruce Buchanan

Bruce E. Buchanan is a founding partner at Sebelist Buchanan Law PLLC with offices in Nashville and Atlanta, where he represents employers in immigration and employment/labor law, with a special emphasis on employer immigration compliance Additionally, he is Of Counsel to Siskind Susser. Mr. Buchanan received his law degree from the Vanderbilt University School of Law and served as a senior trial specialist for the NLRB for 20 years. He also served for 12 years as Adjunct Professor at William H. Bowen UALR School of Law. He went into private practice in 2003. Mr. Buchanan is passionate about representing clients on I-9 compliance issues. He is the co-author of the book, I-9 and E-Verify Handbook, which is geared to HR professionals and available at Amazon. He also authors his own blog on employer immigration compliance located at www.employerimmigration.com and is a regular contributor to HR Professionals Magazine. Bruce is the long-time editor of the TBA’S Immigration Law Section newsletter and Labor and Employment Section newsletter. Mr. Buchanan is admitted to practice in Tennessee, Georgia, Florida, and Arkansas as well as the following Circuit Court of Appeals: 5th, 6th, 8th, and D.C. He may be contacted at [email protected] and (615) 345-0266.

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