Federal court forbids operators of 14 Bay Area Subway stores from endangering, threatening young workers; blocking investigation

SAN FRANCISCO – The U.S. Department of Labor has obtained a preliminary federal court injunction forbidding the operator of 14 San Francisco Bay Area Subway locations from violating child labor laws, threatening and retaliating against workers and obstructing a federal investigation.

The action by the U.S. District Court for the Northern District of California comes amid allegations made by investigators with the department’s Wage and Hour Division that John Michael Meza, owner and operator of the Subway franchises, directed employees as young as 14 and 15 to operate dangerous equipment, allowed children to work longer and at times not permitted by law, issued hundreds of bad checks to employees, failed to pay their wages regularly and kept tips left by customers.

The division also alleges that Meza interfered with its investigation by coercing employees not to cooperate with investigators and threatening children who raised concerns or tried to exercise their legal rights.

During their review, investigators determined several Subway workers had suffered burns and other injuries.

“Federal regulations protect young workers, ensure employees are paid all their hard-earned wages, and allow workers to freely cooperate with a federal investigation without fear of retaliation by their employer,” said Assistant District Director Alberto Raymond with the Wage and Hour Division in San Francisco. “While learning new skills in the workforce is an important part of growing up, federal law dictates that children’s jobs must be safe and that their work doesn’t interfere with their education or well-being.”

The division cited the employer for numerous violations of Fair Labor Standards Act provisions related to the payment of wages, child labor, recordkeeping, retaliation against employees and obstruction of a federal investigation.

“Our investigators learned this Subway franchisee directed young teenagers to operate ovens, toasters, cardboard balers and other equipment, all of which are considered dangerous jobs,” added Raymond. “The court has ordered the employer to stop jeopardizing the safety and well-being of minor-aged workers, to pay workers as the law requires and to ensure that workers can participate in our investigation without fear.”

Specifically, the court’s injunction forbids Meza, his Brentwood-based companies — MZS Enterprises LLC and Crave Brands LLC — his wife Jessica Leyva Meza and associate Hamza Ayesh from violating child labor regulations and from harassing and threatening labor investigators or employees, and from taking retaliatory actions such as termination, reduction of work hours, or threatening to report employees to law enforcement agencies, including immigration authorities.

The court also ordered the Subway franchisee and its owners to stop issuing employees checks drawn on account without sufficient funds and not to pay wages to employees using non-payroll accounts. They must also provide the department with an accounting of all bounced checks from Aug. 1, 2019 to May 19, 2023 to allow the division to calculate the funds owed to affected employees.

In addition, the employers must cease withholding $265,294 in unpaid wages in bounced employee checks and reimburse employees for bad check fees charged to employees by their financial institutions.

“The preliminary injunction we obtained is one tool we will use to prevent further exploitation and intimidation of young, vulnerable workers,” explained Regional Solicitor of Labor Marc Pilotin in San Francisco. “The department will take expeditious legal action when workers’ safety is threatened and when their employers intimidate them or otherwise attempt to obstruct an investigation.”

The investigation and litigation currently include the following 14 Subway franchise locations operated by Meza and his companies:

The division provides many resources to help employers comply with child labor laws Its YouthRules! initiative promotes positive and safe work experiences for teens by providing information about protections for young workers to youth, parents, employers, and educators. Through this initiative, the U.S. Department of Labor and its partners promote positive and safe work experiences that help prepare young workers to enter the workforce. The Wage and Hour Division has also published Seven Child Labor Best Practices for Employers to help employers comply with the law.

Learn more about the Wage and Hour Division, including a search tool to use if you think you may be owed back wages collected by the division. Employers and workers can call the division confidentially with questions, regardless of where they are from. The department can speak with callers in more than 200 languages through the agency’s toll-free helpline at 866-4US-WAGE (487-9243). Download the agency’s new Timesheet App, now available in English and Spanish for Android and Apple devices, to ensure hours and pay are accurate.

Julie A. Su, acting Secretary of Labor, U.S. Department of Labor vs. John Michael Meza, Jessica Leyva Meza, Hamza Ayesh, MZS Enterprises LLC, Crave Brands LLC

Civil Action No. 3:23-cv-01714