Attorney General Eric T. Schneiderman, joined by New York City Council Speaker Melissa Mark Viverito and labor rights advocates, today announced settlements totaling $3.9 million with two interrelated car wash chains owned and operated by John Lage, Michael Lage and Fernando Magalhaes, which together operate approximately 21 car washes in New York City. The settlements are the result of the Attorney General’s investigation into widespread labor law violations, including underpayments, underreporting of employees on state unemployment insurance returns and failure to carry required workers’ compensation insurance for all employees.
The agreements require the car washes and their owners to pay restitution totaling more than $2.2 million to an estimated 1,000 car wash workers for nearly six years of underpaid wages, as well as more than $513,000 to the New York State Department of Labor’s Unemployment Insurance Division and nearly $1.2 million to the New York State Workers’ Compensation Board. In addition, the agreements require the car wash owners to pay for independent monitoring of their labor practices for up to three years, with unannounced on-site inspections and payroll audits, and with results reported to the Attorney General.
