Feds: Toms River Dunkin' Donuts Franchise Violated Pay Laws

A company that owns 55 Dunkin' Donuts stores in New Jersey and New York – including two in Toms River and two in Brick – underpaid their employees and violated the federal Fair Labor Standards Act, officials with the U.S. Labor Department’s Wage and Hour Division announced Monday.

QSR Management LLC, based in Edison, owned all of the stores, the federal agency said.

QSR incorrectly claimed their managers at all 55 locations were exempt from overtime andm as a result of the violations, 56 non-exempt store managers will be paid a total of $197,550 in back wages, the department said in a statement.

Investigators also found that at two locations management, took tips from customer service workers to cover register shortages, resulting in minimum wage violations of $237 for eight employees.

QSR's local stores include the Dunkin' Donuts locations at 1245 Route 166 and 1902 Route 37 west in Toms River, as well as 14 Beaverson Boulevard and 620 Mantoloking Road in Brick.

The company also owns locations in Belmar, Neptune and Asbury Park.

QSR argued that their managers were salaried employees – and thus exempt from being paid overtime – but the company otherwise treated them as hourly employees, the statement said, a violation of the Fair Labor Standards Act.

Although the Fair Labor Standards Act allows an overtime exemption for management employees who perform certain job duties, the exemption only applies if the managers receive a guaranteed weekly salary of at least $455, the statement said.

"QSR has assured compliance with the FLSA and has agreed to pay all back wages," the statement said.

As part of its commitment to future compliance, QSR has changed its employee handbook to reflect its intent to properly apply any valid exemptions, and to no longer allow management to take tips from employees.