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Carl's Jr. slapped with $1.45 million fine for failing to pay minimum wage in L.A.

  • L.A. city officials are demanding that Carl's Jr. fork over $1.45 million in penalties and back wages for failing to pay dozens of workers the minimum wage.
  • CKE Restaurants, the owner of Carl's Jr., said that it had made "an inadvertent payroll error" and has already paid the employees the $5,400 that they were owed in back wages.
  • The company called the Office of Wage Standards' proposed penalty "unreasonable."

City officials in Los Angeles are demanding that fast food chain Carl's Jr. fork over $1.45 million in penalties and back wages for failing to pay dozens of workers the city's $10.50 minimum wage from July to December of last year.

"L.A. law is clear: Employees must be paid at least the minimum wage," Mike Feuer, a Los Angeles City attorney said during a press conference Monday. "Anything less is a slap in the face to workers struggling to make ends meet. This is a major corporation that should know the rules."

The city of Los Angeles is demanding that Carl's Jr. pay about $910,000 in penalties to the 37 employees that the Office of Wage Standards identified as not receiving the correct minimum wage. It is also seeking more than $541,000 from the company for allegedly violating Los Angeles' minimum wage law as well as two other infractions.

"This demand is, on its face simply, unreasonable," the company said in a statement. "It is also unconstitutional in that it disregards the Excessive Fines Clause of the Constitution to obtain money that will not go to our employees and will have no connection to the matter at hand."

CKE Restaurants said that it had made "an inadvertent payroll error" and has already paid the employees the $5,400 that they were owed in back wages.

"Our employees have been made whole and we are willing to pay a reasonable fine for our mistake," the company said Tuesday. "However, given the excessive demands of the OWS, we have no choice but to defend against any OWS actions."

Former CKE Restaurants CEO Andy Puzder has long opposed federal minimum wage increases, saying in the past that "significant minimum wage increases will result in the loss of job opportunities for millions of young Americans."

It is unclear if Puzder's successor, Jason Marker, shares his staunch opposition to wage hikes. Marker took on the role of CEO in March of this year, months after the Los Angeles incident.