June 07, 2017

At the center of the legal battle is an Obama-era rule that vastly expanded overtime pay to salaried workers.

Chipotle employees have sued the fast-casual restaurant chain for allegedly failing to pay overtime compensation, which they say they are entitled to under a recent Labor Department rule at the center of a separate court battle.

The lawsuit, filed Wednesday in a federal court in New Jersey, maintains that the Obama-era Labor Department rule ― which vastly expands overtime pay to salaried workers ― still applies, even though a federal judge in November issued a preliminary injunction to block the Labor Department from enforcing it. 

The suit seeks class-action status for employees like lead plaintiff Carmen Alvarez, one of Chipotle’s so-called “apprentices,” or managers-in-training. Alvarez and others were not eligible for overtime under the old salary cap, but were eligible under the new one, said Joseph Sellers, a lawyer from Cohen Milstein Sellers & Toll who is among the representatives for the suit.

After the Obama administration finalized the rule change last year, Sellers said, Chipotle paid Alvarez and others for a few weeks for overtime they were newly qualified to receive. The payment stopped when the federal injunction against the rule was issued in late November. 

“The [Fair Labor Standards Act] has two ways of enforcing overtime rule. One is from [the] Department of Labor, and the other is individual parties,” Sellers explained. “The injunction stops the Department of Labor, but says nothing about private enforcement.”

The full article can be read here.