(Phoenix, Ariz. – April 21, 2010) Attorney General Terry Goddard today announced the sentencing of the owner and managers of two Phoenix area restaurants who were accused of failing to pay overtime wages to employees and then scheming to make it appear the workers had been paid.
The two restaurants, both named Pinata Nueva, are located in Anthem and Scottsdale. The Scottsdale business was recently sold and is under new ownership.
Martin David Gonzales, 40, of Anthem, who owned the restaurants, pleaded guilty to attempted forgery, a Class 5 felony, and was sentenced to two years of supervised probation and 100 hours of community service. Leonard R. Gallardo Jr., 69, and Frances Lucy Gallardo, 69, both of Scottsdale, managed the restaurants. Each was sentenced to one year probation and 40 hours of community service for tampering with a witness. The corporation, Pinata Nueva LLC of Anthem, was convicted of fraudulent schemes and artifices.
The defendants were jointly ordered to pay a fine of $38,078 to the U.S. Department of Labor and restitution of $11,247 to the employees.
The case was investigated by the U.S. Department of Labor's Wage and Hour Division. The investigation determined that the restaurants owed back wages totaling $38,078 to 38 employees for unpaid overtime. It also found that that restaurants had signed an agreement to pay the employees the money they were owed. According to the Labor Department investigators, Gonzales initially asserted that the firm had paid the wages, but he provided false documents as proof of payment.
In October 2006, the defendants issued back wage checks, and Leonard Gallardo Jr. escorted employees to a local bank where the workers were told to endorse the checks and redeposit them into the restaurants’ accounts. Alerted to the kickbacks, the Labor Department referred the case to the Arizona Attorney General's Office. After Gonzales learned the Attorney General’s Office was working on the case, he repaid a portion of the back wages to some of the employees.
“Any employer who fails to pay workers the money they have earned and lies to the government about it will be held accountable,” Goddard said. “We won’t tolerate such mistreatment, and I’m glad we were able to recover the lost wages.”
"The Wage and Hour Division will pursue strong action against employers who deprive workers -- especially those working low-wage jobs such as in the restaurant industry -- from their hard-earned pay," said George Friday Jr., regional administrator of the Labor Department's Wage and Hour Division in San Francisco. "We appreciate the diligence of the Arizona State Attorney General's Office in taking up this case and ensuring that justice was served for these vulnerable workers in Arizona."
This case was prosecuted by Assistant Attorney General Todd Lawson.
For additional information, contact Molly Edwards at 602-542-8019.