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December 19, 2003
Spitzer Helps Deliver $3.2M for NYC Deliverymen

New York Attorney General Eliot Spitzer announced a $3.2 million settlement with Gristede's Foods, Inc. to resolve allegations of improper wages being paid to grocery deliverymen who worked throughout its New York City supermarket chain.

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The workers, who were hired through a delivery contractor, will receive a minimum of $2.6 million in back pay and damages. Gristede's has agreed to hire the delivery workers in-house and provide benefits, including health insurance, pension, and vacation pay.

The settlement was negotiated jointly by the attorney general's office and the National Employment Law Project (NELP), which had filed a federal lawsuit in the United States District Court, Southern District of New York. The exact amount to be paid to the delivery workers will be determined by the federal judge. A maximum of $650,000 will be provided for private attorneys' fees and costs.

"This agreement is vital because it provides these workers with compensation for the wages that were owed and, more importantly, brings these jobs up out of the underground economy. The delivery workers will now be Gristede's employees just like the cashiers and the people stocking the supermarket shelves, thereby ending an arrangement that denied these workers proper pay and benefits," Spitzer said.

The agreement covers delivery workers who worked in Gristede's stores between 1994 and 2002. During this time period, the delivery workers were hired and paid through delivery contracting companies who assigned them on a full-time basis to the Gristede's stores. Between forty and sixty delivery workers at a time provided the services at Gristede's Manhattan stores. For most of the time period involved, the workers were receiving between $70 and $95 per week plus tips for a sixty hour work week, far below the required minimum wage for tipped employees. The attorney general's office and NELP have sought to hold Gristede's responsible as an employer for the delivery workers' wages even though the company denied that it was the employer.

Under the settlement, the delivery workers in Gristede's stores will now earn a minimum of $6.00 per hour exclusive of tips and will be eligible for benefits provided under a union contract between Gristede's and Local 338 of the Retail, Wholesale and Department Store Union.

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