Kitchen duty

Chipotle's $20 million settlement with workers is an indictment of the entire restaurant industry

The pandemic put a spotlight on the restaurant industry's labor problems.
Chipotle's $20 million settlement with workers is an indictment of the entire restaurant industry
Image: Nicholas Zieminski (Reuters)
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Chipotle agreed to pay $20 million in compensation to 13,000 workers in New York City for violating rights around scheduling and paid sick leave, officials announced Tuesday.

The settlement is the largest worker protection settlement in New York City history, according to the mayor’s office. Chipotle will also pay $1 million in civil penalties.

The settlement is a result of a multi-year long investigation into Chipotle’s labor practices. In 2018, 160 Chipotle employees and a local chapter of the Service Employees International Union filed complaints against the fast-food chain, spurring a city investigation. The city found that Chipotle violated the law by failing to give employees their work schedules 14 days in advance, requiring employees to work extra time without their advance written consent, and not allowing workers to use accrued safe leave, which refers to time off work for safety reasons like for domestic violence, and sick leave, among other things.

“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,” said Eric Adams, the mayor of New York City, in a press release.

The Chipotle agreement stipulates that anyone who worked in an hourly position in New York City will receive $50 for each week worked from Nov. 26, 2017 to April 30, 2022. Former Chipotle employees must file a claim to receive a payment, according to the mayor’s office.

The settlement highlights the continued poor working conditions in the US restaurant industry, which became more visible during the pandemic.

Poor working conditions in the restaurant industry

During the pandemic, restaurant workers quit at record rates due to low pay, obnoxious customers, the lack of benefits, and the risk of contracting covid. The high quit-rates suggest workers were confident they could find better jobs, providing more stability or more pay, such as fulfillment. In 2021, leisure and hospitality workers saw some of the highest wage gains, as employers struggled to find and retain workers.

Despite the wage increases and bonuses, restaurant employment recovery in New York City is still down 15% from February 2020, higher than the national average of 7% from the same time period, according to the latest figures from the US Bureau of Labor Statistics.