Chipotle's Child-Labor Violations In NJ Lead To $7.75M Settlement: AG

NEW JERSEY — Chipotle Mexican Grill promises fresh ingredients. But in New Jersey, some of those burritos may have come with labor violations against the chain's fresh-faced employees.

State officials accused Chipotle of "widespread and persistent" skirting of child-labor laws in restaurants throughout the state. The company agreed Sept. 15 to a $7.75 million settlement to resolve the allegations.

An audit from the New Jersey Department of Labor identified 30,660 alleged violations impacting minors from 2017-20. State officials accused Chipotle of the following violations, according to the settlement:

• breaking laws that prohibit minors from working between 11 p.m. and 6 a.m., working more than 40 hours per week and working more than six straight days
• failing to provide minors with meal breaks of at least 30 minutes after five hours of work
• failing to keep an employment certificate for all employed minors
• failing to keep records for all employed minors

A new state law, passed in July, allows 16- and 17-year-olds to work 50 hours per week during summer break. But during the audit period, companies were prohibited from having a minor work more than 40 hours a week. Related article: NJ Teens Can Work Longer Summer Hours Under New Law

The company's history of child-labor violations in New Jersey and other states spurred the audit, according to the New Jersey Office of the Attorney General. Four of Chipotle's New Jersey restaurants — Fort Lee, Bloomfield, Mays Landing and Parsippany — had been cited for child-labor violations in 2016-18.

The settlement allows Chipotle to forgo admitting to any of the state's claims. Laurie Schalow, Chipotle's chief corporate affairs officer, told Patch the following via the company's media office:

"We are committed to ensuring that our restaurants are in full compliance with applicable laws and regulations and we believe that in hiring workers beginning at age 16, we can provide younger employees with valuable experiences and an opportunity for advancement. We have reached a settlement with the New Jersey Office of the Attorney General for the events dating back to 2017, and have implemented an enhanced labor scheduling program in our restaurants, creating a more efficient, consistent and compliant environment.

Chipotle gives workers, including younger employees, industry-leading benefits such as debt-free degrees, tuition reimbursement up to $5,250 per year, access to mental healthcare, financial planning tools, and the opportunity for quarterly bonuses for all employees, including hourly crew members, up to a month’s worth of pay per year. We also provide transparent career progression showing how Chipotle crew members can advance to a Restaurateur, the highest General Manager position, in as little as three and a half years, with a total compensation package of approximately $100,000 while leading a multi-million-dollar growing business."

But allegations against Chipotle tell a different story about the chain's labor record. The state of Massachusetts fined the company $1.37 million in 2020 for more than 13,000 child-labor violations.

More recently, Chipotle closed the chain's first restaurant to file for a union election. Those who sought to unionize the Augusta, Maine, location filed a complaint last summer with the National Labor Relations Board. The workers had told The Kennebec Journal that they were sometimes told to falsify food-temperature logs because understaffing meant they didn't have the time to check often enough to meet food-safety regulations.

Schalow told CNBC that Chipotle "respect(s) our employees’ rights under the National Labor Relations Act and are committed to ensuring a fair, just, and humane work environment that provides opportunities for all."

In New Jersey, the $7.75 million settlement will support the state labor department's Child Labor Law Enforcement Trust Fund. Officials use the fund to enforce laws protecting children in the workplace and to educate workers and employers about work involving minors.

The settlement also requires Chipotle to commit to a longterm strategy to ensure future compliance with New Jersey's child-labor requirements. Steps include periodic self-audits, designating a child labor compliance official, and mandatory formal training for all current and future managers, supervisors and staff to raise awareness on the state's labor protections for minors.

"It makes good business sense to treat all workers, particularly minors, fairly and in accordance with the law," state Labor Commissioner Robert Asaro-Angelo said in a statement. "There is no excuse for any business, particularly a major, profitable corporation with prior violations, to continually deny young employees their work rights."