NYC reaches $20 million settlement with Chipotle says Mayor Eric Adams

New York City, which sued Chipotle over alleged violations of local labor law, has reached a $20 million settlement with the burrito behemoth that could deliver compensation to about 13,000 workers, officials said Tuesday.

Mayor Adams spilled the beans on the deal at a City Hall news conference, wrapping up a nearly three-year-old legal battle that began in 2019 when the city — citing claims of short-notice changes to Chipotle workers’ schedules — filed a lawsuit seeking at least $1 million in penalties.

The court fight was undergirded by a 2017 municipal law demanding that fast food chains give their employees two weeks’ notice before shifting their schedules. Last year, the city expanded its case, saying Chipotle’s infractions had continued, and arguing workers were owed more than $150 million.

The administration of former Mayor Bill de Blasio, which filed the complaints, charged that Chipotle had committed widespread violations of the city’s Fair Workweek Law, and deployed an illegal sick leave policy.

The city said its investigations found Chipotle had required employees to work extra time without prior consent, upended schedules with little notice and failed to pay properly for altered hours.

On Tuesday, Adams said that workers “must be able to plan their lives.”

“We want businesses like Chipotle to open here and thrive here,” he said at the news conference. “That’s crucial for us. But they cannot exist without the hard-working people who are cooking, serving and delivering our food.”

The Department of Consumer and Worker Protection commissioner, Vilda Vera Mayuga, described the agreement as the “largest fair work week settlement in the country.”

[ Burrito bullies: NYC sues Chipotle amid accusations from workers that the fast-food giant violated fair workweek laws ]

The settlement could mark a step toward warming an icy relationship between City Hall and Chipotle, which claims 129 locations in the New York City area.

Last year, de Blasio called for New Yorkers to boycott the chain. “They are lawbreakers, period,” the then-mayor, who is an Adams ally, said at a rally. “And they will pay.”

The restaurant confirmed Tuesday that it would pay. It said it would establish a fund to compensate workers, noting that under the settlement terms, active Chipotle employees as of April would have the opportunity to score $50 per week of service dating to late November 2017.

The Colorado-based company said past employees would be informed they can file claims. Chipotle also promised to pay the city an extra $1 million penalty.

Chipotle’s chief restaurant officer, Scott Boatwright, said in a statement that the settlement showed his company’s “commitment to providing opportunities for all of our team while also complying with the Fair Workweek law.”

“We hope this settlement will pave the way for greater cooperation between the restaurant industry and the City,” Boatwright added in the statement.

Mayuga said the city would continue to probe any complaints against Chipotle. “We’re really happy that Chipotle came to the table,” she said at the news conference.

Separately, more than a dozen Chipotle workers filed complaints with the city last month alleging they were fired or had their hours cut in violation of the city’s so-called Just Cause Law. Mayuga said the city’s investigations of Just Cause Law complaints are active.

[ NYC Chipotle workers claim they were illegally fired in latest legal headache for fast food giant ]

Still, Paloma Munez, who works at a Chipotle in Chinatown, said the announcement of the settlement gave her goosebumps.

“I felt like it was a step toward working people,” Munez, 19, said after the news conference. “A lot of people — they’re used to the bad conditions. And I feel like it shouldn’t be something they’re used to.”

Adams applauded Local 32BJ of the Service Employees International Union, which helped workers file complaints against Chipotle. The settlement was the product of a probe of complaints filed by 160 Chipotle workers and by the union, according to City Hall.

“We’re going to ensure that our restaurant workers are treated with the dignity and respect that they deserve,” the mayor said. “Today’s settlement is a victory for workers.”