New York Dunkin’ Donuts Operators Hit with Class Action Over Alleged No-Hire Agreements

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Five Dunkin' Donuts operating companies find themselves as defendants in the latest proposed class action filed in New York to allege current and former employees have been harmed by long-standing and illegal non-solicitation agreements. The 18-page complaint claims that under the hush-hush agreements, the defendants—Albany Shaker Donuts, Cohoes Donuts, Thompson Road Donuts, Worcester Upstate Donuts and Dunkin' Donuts Franchising LLC—pledged to not solicit or “poach” each other’s employees throughout New York, thereby depressing workers’ wages.

Citing possible violations of state antitrust statutes and the Sherman Antitrust Act, the lawsuit charges the defendants’ no-poaching conspiracy has deprived proposed class members of millions in wages. The lawsuit echoes allegations recently made against other fast food purveyors in the wake of a July 2018 New York Attorney General investigation into alleged competition-suppressing conduct across the fast food industry. From the suit: 

“As set forth herein, upon information and belief, all of the Defendants entered into the mutual non-solicitation agreements with the no-hire and non-solicitation terms above, with the common interest and intention to keep their employees’ wage costs down, so that profits continued to rise or at least not be undercut by rising salaries across the industry. As a result, Defendants engaged in anti-competitive behavior in advancement of a common and illegal goal of profiting at the expense of competitive market-based salaries.”