WASHINGTON, D.C. – Attorney General Karl A. Racine today filed a lawsuit against Jan-Pro Franchising International and Jan-Pro of Washington, DC (referred to together as “Jan-Pro”) for operating a multilevel franchising scheme that misclassifies janitorial employees as independent contractors. Jan-Pro lured District janitors to sign “franchise agreements” with promises of financial independence and entrepreneurial success. In reality, however, janitors function as Jan-Pro’s employees—and through being misclassified, are denied hard-earned wages and paid sick leave they are entitled to under District law.
“This illegal scheme was a clear bait-and-switch, which effectively forced workers to shoulder Jan Pro’s business costs,” said AG Racine. “If any company steals their employee’s hard-earned wages and benefits, my office will hold them accountable.”
The Office of the Attorney General (OAG) alleges that Jan-Pro systemically misclassifies janitors as independent contractors. Janitors should be classified as employees because Jan-Pro exercises substantial control over their working conditions and rate of pay. By misclassifying janitors, Jan-Pro subjects them to a blizzard of unlawful deductions that cut into their wages. These deductions include start-up fees that essentially require janitors to pay thousands of dollars just for the opportunity to work for Jan-Pro. They also include recurring monthly fees that eat into as much as 25% of workers’ monthly earnings. District law prohibits employers from making unlawful deductions from employees’ wages.
Jan-Pro operates as a multilevel franchising scheme. Jan-Pro International sells janitorial services across the nation by sub-franchising with regional companies like Jan-Pro of Washington, DC, which focuses on the District metropolitan area. Both companies then work together to recruit janitors. Jan-Pro International provides the structural documents, which include contracts that misclassify janitors as independent contractors. Jan-Pro of Washington, DC then uses these documents in handling the direct recruitment of District janitors. In this way, both companies are actively engaged in the systemic misclassification of District janitors—who notably perform the physical labor that is at the heart of Jan-Pro’s business.
OAG’s complaint alleges that Jan-Pro violated the District’s Wage Payment and Collection Law (WPCL) and Sick and Safe Leave Act (SSLA) by:
- Making Unlawful Wage Deductions. The WPCL prohibits employers from making unlawful deductions from an employee’s wages. Jan-Pro’s misclassification scheme imposes on janitors a host of “fees” that amount to unlawful wage deductions that violate the WPCL and contravene common sense employment principles. For example, janitors are required to pay thousands of dollars in initial franchise fees to start working for Jan-Pro in the first place—effectively requiring janitors to pay their employers for the opportunity to work. In addition, Jan-Pro also shifts routine business expenses onto its workers by charging janitors a slew of recurring monthly fees that cover janitorial costs such as cleaning supplies and liability insurance. Jan-Pro even punishes janitors for work performance issues, imposing monetary fees for customer complaints.
- Failing to Provide Paid Sick Leave. The SSLA requires employers to provide employees with paid sick leave, which is accrued based on hours worked. Employees can use their accrued leave to take paid time off work for numerous medical reasons, including caring for their own illness or that of a family member. As a result of its misclassification scheme, Jan-Pro fails to provide its janitors with any paid sick leave whatsoever.
With this lawsuit, OAG is seeking to: (1) recover damages and penalties from Jan-Pro for systemically exploiting the wage-and-hour rights of District janitors; (2) prevent them from continuing to engage in this worker misclassification scheme; and (3) recover statutory penalties for each violation of the WPCL and SSLA.
A copy of the complaint is available here.
DC Wage & Hour Laws
The District’s Minimum Wage Revision Act (MWRA) creates a baseline wage of $16.10 per hour. If an employee works more than 40 hours per week, the MWRA requires the employer to pay them an overtime rate of 1.5 times their regular rate. The District’s Sick and Safe Leave Act (SSLA) requires employers to provide paid sick leave, accrued at rates that are keyed to the size of the employer. Workers can learn about their rights under District law and how they can get help if their rights are being violated here.
OAG’s Efforts to Protect Workers
In 2021, OAG established the Workers’ Rights & Antifraud Section, which is dedicated to fighting wage theft and protecting District workers. Since gaining wage theft enforcement authority in 2017, OAG has launched more than 75 investigations and recovered over $7 million for workers and the District by bringing investigations and lawsuits against employers who violate District law. OAG’s wage theft enforcement efforts have focused on industries with high populations of vulnerable workers, such as construction, restaurants and hospitality, healthcare, and the gig economy. AG Racine also testified before Congress to highlight findings from an OAG report about how worker misclassification hurts workers, undercuts law-abiding businesses, and cheats taxpayers.
How to Report Wage and Hour Violations
Workers who believe that their rights have been violated, or that they have experienced wage theft or other wage and hour violations, can contact OAG by calling (202) 442-9828 or emailing firstname.lastname@example.org or email@example.com.