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Chipotle Mexican Grill Slips 5% After NYC Sues For Labor Law Violations

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Shares of Chipotle Mexican Grill Inc. (CMG) slipped about 5% after New York City filed a lawsuit against the Mexican-themed fast-casual restaurant chain alleging it violated the city's Fair Workweek Law.

The lawsuit alleges that Chipotle violated nearly every aspect of the City's Fair Workweek Law, including failing to provide good faith estimates of work schedules and schedules two weeks in advance. The chain also allegedly failed to get consent and pay premiums for last minute schedule changes and for working "clopenings," and failing to offer newly available shifts to current employees.

"In New York City, predictable schedules for fast food and retail workers are a right, not a privilege," said Mayor de Blasio. "No corporation can get away with blatantly violating the rights of New York City workers without consequences. Chipotle must immediately stop their unfair labor practices and put their employees above profit."

More than 30 employees from five different Brooklyn locations of Chipotle filed complaints with the Department of Consumer and Worker Protection.

The lawsuit, which has been filed at the Office of Administrative Trials and Hearings (OATH). The Department of Consumer and Worker Protection is seeking at least $1 million in restitution for workers plus civil penalties and future compliance with the requirements of the Fair Workweek Law.

"It is disappointing that numerous Chipotle locations are ignoring the City's Fair Workweek Law and continuing to take advantage of their workers," said DCWP Commissioner Lorelei Salas. "This case exemplifies the abusive practices that this law is intended to end, and Chipotle must come into compliance. I encourage all fast food workers to come forward if their right to a predictable schedule or new shift is being violated."

CMG is currently trading at $792.80, down $46.85 or 5.58% on the NYSE.

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