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Papa John’s Wins Final Approval for $5 Million No-Poach Settlement

By  |  August 18, 2026
Papa John's Sees N. America Sales Jump 33 Pct

Papa John’s International Inc. secured final court approval of a $5 million settlement resolving allegations that restrictions between its franchisees unlawfully limited workers’ ability to move between restaurants and depressed their pay.

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    The approval brings nearly eight years of litigation over the pizza chain’s use of so-called no-poach agreements closer to an end, according to Bloomberg Law’s. The lawsuit alleged that restrictions contained in franchise agreements reduced competition for employees by preventing franchisees from recruiting or hiring workers from other Papa John’s locations.

    U.S. District Judge Benjamin Beaton of the Western District of Kentucky approved the settlement in an Aug. 14 opinion, Bloomberg Law reported. The $5 million payment is substantially below the approximately $195 million in classwide damages calculated by an expert for the plaintiffs, but Beaton concluded that the compromise was reasonable.

    A significant factor supporting the settlement was the difficulty many workers would face in pursuing their claims outside the deal. Beaton said settlement appeared to offer the only realistic avenue for compensation for roughly half of the class because those workers were subject to arbitration agreements, according to Bloomberg Law.

    The dispute centered on provisions that restricted Papa John’s franchise operators from hiring employees working at other restaurants in the chain. Workers alleged those arrangements violated federal antitrust law by reducing competition for their labor, limiting employment opportunities and holding down wages.

    Read more: Papa John’s Agrees to Settle Employee No-Poach Lawsuit

    The case was consolidated in Kentucky federal court in 2019 after related lawsuits were filed against the company. The proposed class encompasses roughly 520,000 people who worked at Papa John’s restaurants in the U.S. during the relevant period, according to previously published information about the settlement.

    Papa John’s had agreed to the $5 million resolution years before final approval. The settlement also calls for changes aimed at preventing the future use of no-poach restrictions, including antitrust compliance measures and limits on such provisions in franchise agreements, according to published accounts of the agreement.

    The litigation is part of a broader antitrust debate over agreements that restrict competition for workers. Regulators and private plaintiffs have increasingly scrutinized no-poach arrangements on the theory that competition law protects labor markets as well as markets for goods and services.

    For the Papa John’s workers, the final approval resolves that dispute without requiring them to prove at trial that the franchise restrictions caused the full amount of damages they alleged.

    Source: Bloomberg Law