Upper East Side Pizza Shop Stole $175K From Its Workers, AG Says

UPPER EAST SIDE, NY — The owner of a well-known pizza shop with two Upper East Side locations will pay back $175,000 to his employees after an investigation found he had cheated them out of their wages for years, the state attorney general's office announced Friday.

Gotham Pizza, whose three Manhattan shops include one on York Avenue and East 77th Street and another on First Avenue and East 87th Street, stole wages from at least 10 employees between 2016 and 2019, according to Attorney General Letitia James's office.

Specifically, Gotham Pizza's owner Michael Shamailov deprived the workers of overtime pay, tips, and proper minimum wage — paying them just $6 to $10 per hour instead of the minimum $11 to $15, James's office said.

"No matter how you slice it, fair pay is not a suggestion — it’s the law," James said in a statement.

While the employees often worked more than 40 hours per week, they were never given any overtime pay, according to prosecutors — a violation of state law.

The state's investigation began in October 2019, and Shamailov agreed to repay the workers earlier this year. He did not admit to any wrongdoing as part of the agreement, and Shamailov's attorney did not immediately respond to a request for comment.

Meanwhile, at least one worker has filed his own lawsuit against Gotham based on similar allegations. Pedro Mejia Mendez, who worked as a delivery cyclist out of Gotham's York Avenue shop, sued Shamailov in 2019, saying he was deprived of regular wages, tips and overtime despite working 79-hour weeks.

Shamailov denied those claims, and Mendez's suit is still pending in state court, records show.

This week's agreement covers workers at both Upper East Side shops, plus Gotham's third location on Ninth Avenue in Chelsea, according to James's office. (Two of Gotham's former locations, on Third Avenue near Union Square and Eighth Avenue in Midtown, have since closed.)

As part of the agreement, Gotham Pizza will need to send compliance reports to the attorney general's office with payroll information for all of its employees. The AG's office will also conduct spot interviews with Gotham employees to confirm that they are being "consistently and properly paid," according to James's office.

If Gotham fails to comply with the agreement or keeps underpaying workers, the attorney general's office may bring a civil action against the business.

"For years, Gotham Pizza took advantage of its hard-working employees by failing to pay them for their work," James added on Friday. "I am proud to recover the money they have long been owed and cheated, and I will always fight to ensure New Yorkers get their fair piece of the pie."

Local lawmakers, including City Councilmember Julie Menin, also applauded the investigation.

"As the former Commissioner of the New York City Department of Consumer and Worker Protection, I made it a priority to protect our city’s workers,” Menin said in a statement. "This is intolerable that Gotham Pizza has violated worker-protection laws and paid below the minimum wage."