🗞️ Detroit Coney Island Franchises Ordered to Pay $515,000 in Overtime Case
A federal court ordered the owner of four Detroit area Leo's Coney Island franchises to pay $515,857 to 143 workers after federal regulators alleged he shredded overtime timecards, years after agreeing to a similar 2018 court order.
A federal judge in Michigan has approved a consent judgment requiring the owner of four Leo's Coney Island restaurant franchises to pay more than half a million dollars in back wages, damages, and penalties to 143 current and former employees. The U.S. Department of Labor said the case, resolved in the U.S. District Court for the Eastern District of Michigan, involves locations in Clarkston, Dearborn, Livonia, and Sterling Heights operated by Kiriakos "Ken" Vlahadamis.
Investigators with the department's Wage and Hour Division alleged that Vlahadamis and the four franchise entities paid workers straight time for all hours worked, including those beyond 40 hours in a given week, rather than the time and a half required under the Fair Labor Standards Act. The department further alleged that the company kept two separate sets of timecards, one recording hours worked under 40 per week and another recording overtime hours, and that the overtime records were regularly destroyed.
The judgment follows an earlier dispute between Vlahadamis and the department. A 2018 consent order in the same court had already prohibited him from committing future violations of the Fair Labor Standards Act. When Wage and Hour Division investigators identified the alleged timecard practices in 2024, the department sought and obtained a temporary restraining order, followed by a preliminary injunction requiring accurate recordkeeping, and asked the court to hold Vlahadamis in civil contempt for violating the 2018 order. That contempt matter was resolved separately, with the defendants paying $10,000 in attorney fees. The judgment entered in May 2026 also requires $73,784 in civil penalties, in addition to the wages and damages owed to workers.
Leo's Coney Island is a regional restaurant chain with more than 70 locations across Michigan. The four franchises named in the case operate as separate corporate entities under license to use the brand name.
Key Points
- Consent judgment entered May 26, 2026, requires $515,857 in back wages and damages to 143 workers
- An additional $73,784 in civil penalties was ordered, and the defendants separately paid $10,000 in attorney fees tied to a related contempt matter
- Allegations include paying straight time for overtime hours and destroying timecards that recorded overtime
- A 2018 consent order in the same court had already prohibited the owner from future violations of the Fair Labor Standards Act
- A 2024 temporary restraining order and preliminary injunction preceded the final judgment
- Named franchises include Sterling Ponds LLC, Clarkston Restaurant Inc., Dearborn Plaza Coney Island Inc., and Stass Restaurant Inc.
Primary Source Author: U.S. Department of Labor, Wage and Hour Division
Primary Source: Federal court order requires 4 Detroit-metro Leo's Coney Island franchises, owner to pay $515K in back wages, damages to 143 workers
Primary Source Link: https://www.dol.gov/newsroom/releases/whd/whd20260730
