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Chipotle Just Paid $20 Million for Violating NYC’s ‘Fair Workweek’ Law. Workers Say The Chain Is Still Messing With Their Schedules.

The City Council is considering upping penalties for companies that are repeat offenders, which workers allege includes the fast casual Mexican-style restaurants.

SHARE Chipotle Just Paid $20 Million for Violating NYC’s ‘Fair Workweek’ Law. Workers Say The Chain Is Still Messing With Their Schedules.

The exterior of a Chipotle in Midtown on Tuesday, August 9, 2022.

Hiram Alejandro Durán/THE CITY

Chipotle workers and City Council members are raising questions about the company’s application of the city’s Fair Workweek Law – mere weeks after the company agreed to a $20 million settlement with the city in connection with allegations it violated workplace protection laws around scheduling and paid sick time.

On Monday the City Council Consumer and Worker Protection Committee held a hearing where lawmakers weighed increased fines and penalties for fast-food companies that flout the law — including denying, suspending or revoking the licenses of repeat offenders. 

The Fair Workweek law, in effect since 2017, mandates that management at fast-food restaurants give notice to employees of their schedules at least two weeks in advance.

Al Diaz-Larui, a Chipotle worker, told THE CITY he believes he is still owed compensation for two last-minute shift cancellations last month.

“How can they be so — I don’t want to say ‘dumb’ — but it’s true,” said Diaz-Larui, 44, who works at an outpost on 56th Street and 6th Avenue. “Like you guys just paid out, you know, a settlement of $20 million and you’re doing the same thing over and over again.”

A spokesperson for Chipotle did not respond to a request for comment.

“I definitely do think they’re doing it because they think they can get away with it. Because a lot of people here are misinformed,” he added. “They don’t even know you know; they think I’m one of those employees as well.” 

That $20 million settlement announced Aug. 9, the largest of its kind, was the result of a four-year investigation and complaint filed by the city Department of Consumer and Worker Protection in 2018. 

Workers covered under that settlement will receive restitution checks beginning Sept. 25, commissioner Vilda Vera Mayuga told THE CITY on Friday.

‘Flagrant Abuse of the Law’

One of the bills the council’s Consumer and Worker Protection Committee is considering would double the maximum allowable civil fines for violations of the Fair Workweek Law, to $1,500 from the current $750 for employers who violate the law for the second time in as many years, and to $2,000 for each subsequent violation, up from $1,000. Repeat offenders would also receive a $30,000 fine, up from $15,000.

That bill, introduced by labor committee chair Carmen de la Rosa (D-Manhattan), would also empower the city Department of Consumer and Worker Protection (DCWP) to revoke the licenses of repeat offenders, including those that have accumulated $500,000 in fees or more in a three-year period in connection to violations of the Fair Workweek Law or the city paid sick-leave law.

Another bill, introduced by committee chair Marjorie Velásquez (D-The Bronx), would mandate paid workers’ rights training for certain fast-food employees.

Council members de la Rosa, Velásquez, Gale Brewer (D-Manhattan) and Julie Menin (D-Manhattan) grilled representatives from the Department of Consumer and Worker Protection about the agency’s capacity to keep up with violations.

The committee also heard from worker Lucia Pacheco, who testified that the “inconsistent schedule and reduction in hours make it difficult for me to plan my life outside of work” and to care for her baby. She said she has filed a complaint with DCPW because Chipotle cut her hours “unlawfully.”

“It also makes it hard to save money or plan for my family’s future,” added Pacheco, who works at the Chipotle outpost at Riverdale Crossing in The Bronx.

Another worker, Teófila Guadalupe, testified in Spanish that her manager at a Chipotle on Broadway near Woodhull Hospital in Brooklyn “does not always schedule me to work during the hours that we have agreed on.” Over the summer, she said, Chipotle started hiring new workers at her outpost such that her schedule was reduced to just 22 hours a week over three days, down from her previous five-day schedule.

Guadalupe added that she submitted a complaint with DCWP in June. “I hope to receive what I’m owed, but I’d rather they follow the law in the first place.”

Menin, a former DCWP commissioner under the de Blasio administration, said she was “incredibly troubled” by the workers’ testimony.

“To me, it sounds like it’s retaliation, which is a flagrant abuse of the law,” she said. “The fact that your hours were being cut, the fact that you’re being told to go to a different store, the fact that they’re sending the new employees who are getting these hours all speak to retaliation, and I think we need to alert the commissioner to that immediately.”

Chipotle workers in New York City, who are not unionized, have organized with 32BJ SEIU for years around issues of fair scheduling practices and paid sick leave. The union has accelerated its efforts at the fast-casual chain because the outposts are company-owned, rather than being largely held by individual franchisees as is the case at many other major chains such as McDonald’s.

32BJ members protest what they say was the illegal firing of a union organizer at a Flushing Chipotle, April 28, 2022.

Ben Fractenberg/THE CITY

“Far too often, massive corporations, like Chipotle, have viewed the fines and occasional lawsuits sparked by their repeated violations of NYC employment laws, such as the Fair Workweek law, as little more than the ‘cost of doing business,” 32BJ SEIU president Kyle Bragg said in a statement on Monday. “These two pieces of legislation aim to force a fundamental rethinking of that business model.”

Last month, workers at a Chipotle in Lansing, Mich. became the first of the company’s 3,000 locations in the country to unionize, voting 11-3 to join the International Brotherhood of Teamsters.

Educating Workers about the Law

Asked about the proposed penalties for repeat offenders, current agency legal director for labor policy and standards Elizabeth Wagoner said the office is prepared to act — including to potentially shut down scofflaws, which she called “a very interesting idea.”

“We are looking forward to working with the Council on ideas for boosting deterrence for non-compliance. And to the extent a possible revocation could accomplish that goal, we are happy to explore that further,” she told the committee. 

The agency has about 20 investigators on staff working on enforcement cases, Wagoner told THE CITY in an interview on Friday, adding that the agency decides whether to “expand the scope” of an investigation if it receives a high volume of complaints.

That’s one reason the agency went after Chipotle: It received 160 complaints from workers about alleged Fair Workweek and Paid Safe and Sick Leave Violations between 2017, when the former went into effect, and 2019. That’s the year the agency pivoted to a citywide probe into the company’s practices that yielded the $20 million settlement. 

“My goal is to educate people,” Mayuga told THE CITY on Friday. “Because we can be very knowledgeable about the laws in the books, but if the people that are supposed to be protected by those laws don’t know about them then, you know, they don’t really serve any purpose.”

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