A pizza company has agreed to pay $320,000 in a settlement for not complying with the “Healthy San Francisco” ordinance, City Attorney Dennis Herrera announced Sunday.
Patxi’s Chicago Pizza, which has four locations in San Francisco, did not use most of a 4 percent surcharge added to customers’ bills for employee health care between 2009 and 2011, according to the city attorney’s office.
The settlement will distribute $205,000 to current and former Patxi’s employees, increase health care spending by about $100,000 for 2013 and require the company to pay the city $15,000 in penalties.
“Though Patxi’s was wrong to not comply with the health care ordinance and to collect a surcharge from its customers for health benefits it wasn’t providing to employees, the company deserves credit for working cooperatively with us to remedy the problem,” Herrera said in a statement.
“When we discovered that our health care plan did not comply with San Francisco law and that we were collecting more in surcharges than we were paying for employee health care, we knew we needed to take immediate steps to make things right,” Patxi’s CEO William Freeman said.
“Patxi’s is proud of the role it plays in the community, and we want to make sure we comply with the spirit as well as the letter of the law,” Freeman said.
The Healthy San Francisco program, enacted in 2006, requires businesses with more than 20 workers to either provide health insurance or pay a fee to the city.
The city attorney’s office waged a four-year legal battle to defend the program, which was finally upheld in 2010 when the U.S. Supreme Court refused to hear an appeal by a business group.
Dan McMenamin, Bay City News