Chipotle has agreed to pay $20 million to roughly 13,000 New York City workers after being accused of multiple labor violations under Fair Workweek and Paid Safe and Sick Leave laws.
The fast casual is also subject to a $1 million fine in civil penalties. The overall settlement is the largest fair workweek agreement in the U.S. and the biggest work protection settlement in NYC history.
Some of the major issues were: Not giving two weeks notice of work schedules, requiring employees to work extra time without written consent, not providing premium pay for schedule changes, mandating employees open and close without the $100 premium pay, not offering shifts to current employees before hiring new ones, and not allowing workers to use accrued safe and sick leave.
As part of the deal, every hourly employee in NYC will receive $50 for each week worked from November 26, 2017 to April 30, 2022. These workers, who must file a claim to participate, will receive a check in the mail, along with a letter explaining how their payout was calculated.
"Restaurants and fast food outlets are a critical part of our economy and our daily life here in New York City, but they cannot exist without the hard-working people who are cooking and serving and delivering our food," NYC Mayor Eric Adams said in a statement. "Today's settlement with Chipotle is not only a victory for workers by securing up to $20 million in relief for approximately 13,000 workers, but also sends a strong message, as the largest worker protection settlement in New York City history, that we won't stand by when workers' rights are violated. I thank 32BJ SEIU for helping uncover these violations and the Department of Consumer and Worker Protection for getting justice for these workers."
NYC officials began investigating Chipotle's compliance in 2018 after receiving a series of complaints from workers in Brooklyn. A year later, a case was filed. Then in April 2021, upon uncovering more information, the litigation expanded to include all NYC locations.
Scott Boatwright, Chipotle's chief restaurant officer, said the brand is "pleased to be able to resolve these issues." The company noted that in the NYC market last year, it raised hourly wages 11 percent to $17.37, and manager wages 8.6 percent to $19.98 per hour. The brand also gave salaried workers a $5,473.45 boost in annual pay.
“We have implemented a number of compliance initiatives, including additional management resources and adding new and improved time keeping technology, to help our restaurants and we look forward to continuing to promote the goals of predictable scheduling and access to work hours for those who want them. We hope this settlement will pave the way for greater cooperation between the restaurant industry and the City,” Boatwright said in a statement.
The announcement comes about a year and a half after Chipotle was ordered to pay out $15 million to workers that were incorrectly exempted from overtime wages. The case impacted roughly 4,800 workers. In January 2020, Chipotle agreed to pay $1.37 million in fines for more than 13,000 child labor violations in Massachusetts.