Chipotle agrees to pay $240K after closing a store that sought to unionize

Chipotle Mexican Grill has agreed to pay $240,000 to former employees as part of a settlement stemming from a complaint that the company violated federal law by closing a restaurant where workers wanted to unionize.

Chipotle announced it was permanently closing its Augusta, Maine, location last year after workers filed a National Labor Relations Board petition for a union election. The NLRB later said the closure was illegal.

The Maine location was the first in the chain to file a union petition. The settlement, released by union officials on Monday, states that two dozen employees will receive payments from Chipotle and they will be placed on a preferential hiring list for other Maine locations.

The company must also post a notice in dozens of stores in New England that it won’t close stores or discriminate against employees due to union support, the settlement states.

“It sends a message to corporations that shutting down a store and blackballing workers didn’t work for Chipotle and it won’t work for them either,” said Brandi McNease, a former employee of the Augusta store and the lead organizer of the union drive, in a statement provided by the Maine AFL-CIO.

Settlement cheaper than court battle, Chipotle says

Chipotle said in a statement that it settled the lawsuit because fighting it would have been burdensome and expensive. The company respects “our employees’ rights to organize under the National Labor Relations Act” and is “committed to ensuring a fair and just work environment that provides opportunities to all,” Laurie Schalow, chief corporate affairs officer for the company, said in a statement.

“We settled this case not because we did anything wrong, but because the time, energy and cost to litigate would have far outweighed the settlement agreement,” Schalow said.

The Augusta location closed last summer. Workers described the closure as retaliation for the union drive, but company representatives said the closure wasn’t related to unionization.

The payments the workers are receiving vary based on their average number of hours worked, pay rate and longevity prior to the store closing, union officials said.