A company that owns 40 Burger Kings had to pay $459,000 to workers after it denied them sick leave, in Chicago's largest-ever labor-law fine

gdean@insider.com (Grace Dean) 

© Provided by Business Insider Tri City Foods failed to grant paid sick leave to 2,473 employees at its Burger King restaurants. 

Faris Hadziq/SOPA Images/LightRocket via Getty Images

The owner of 40 Burger Kings was handed Chicago's largest labor-law violation fine.

Tri City Foods must pay workers $458,931 total after denying them proper sick leave, the mayor said.

It must also pay the city of Chicago $100,000.

A company that owns 40 Burger King restaurants in Chicago has paid the city's largest ever labor-law violation fine.

Tri City Foods is a holding company that says it is Burger King's second-largest franchisee, with restaurants across six Midwest states. It had to pay a $100,000 fine to the city of Chicago, alongside $458,931 in restitution to workers it had denied sick leave to, according to a Thursday press release by Chicago Mayor Lori Lightfoot. Block Club Chicago first reported on the news.

Employers at most Chicago businesses must give staff one hour of guaranteed paid sick leave for every 40 hours worked because of a law introduced in July 2017.

But Tri City Foods failed to grant enough paid sick leave to 2,473 employees at its restaurants between July 2017 and November 2020, Chicago's Office of Labor Standards (OLS) found in an investigation, which the OLS said was started by a 311 complaint.

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"When you are paid in a minimum wage job, when you worry about your job and living from paycheck to paycheck, it takes a lot to stand up and assert your rights and say something here isn't fair," Lightfoot said in a press conference Thursday.

"And this is a big deal," she continued. "And this person's taking the initiative means not only that person is covered, but the workers are covered to the tune of almost five hundred thousand dollars."

The mayor's office said payments to Tri City Foods staff would be sent over the coming months now that the city and the company had reached a settlement.

Tri City Foods was not immediately contactable for comment.

Mondelez also hit with a massive fine

Chicago-based food and drink company Mondelez also had pay a $95,217 fine after it failed to provide paid sick leave to 465 employees from July 2017 to early 2020, the mayor's office said Thursday in the same press release. It had to pay $476,083 in restitution to these employees.

Mondelez, which owns Cadbury, Oreo, Milka, and other brands, told the OLS it had sought to bargain in good faith with the union representing these employees when the local labor contract expired.

"The City opted to seek a lower than maximum fine in this case due to Mondelez's plausible defense, full cooperation with the investigation, and immediate action to correct the violation," the mayor's office said.

It added that Mondelez had corrected the violations by early 2020, meaning that proper paid sick leave was provided during the pandemic. Payment to covered employees is underway and nearly completed, the mayor's office said.

A Mondelez spokesperson told Insider that its collective bargaining agreements with a local union had expired and that unilaterally implementing local paid leave could have violated the National Labor Relations Act.

"The City and the Company reached a mutual agreement to avoid litigation and resolve the dispute over paid sick leave, and the City has acknowledged the Company's and the Union's obligation under federal labor law to continue bargaining over paid sick leave," the spokesperson said, adding that Mondelez moved "immediately" to make corrections following the settlement.

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