Chipotle agrees to $240,000 payout to former ex-employees after shutting store that filed to unionize

Chipotle Mexican Grill is paying its former staff who worked in the location that it shut down after trying to unionize. The restaurant chain agreed to settle up with the employees with a $240,000 payment.

The compensation is part of a settlement as the former Chipotle workers filed a complaint against the company for violations of federal law after it closed their workplace when they expressed their intention and attempted to take steps to unionize.

Associated Press News reported that Chipotle made an announcement about the permanent closure of its Augusta, Maine branch last year. It happened after the staff filed a petition for a union election with the National Labor Relations Board.

Later, the independent agency of the federal government of the United States, which enforces the country’s labor law in connection with collective bargaining and unfair labor practices, declared that the Maine restaurant’s closure was illegal.

The said Chipotle store was the first in the chain that filed to unionize. The settlement was announced by union officials this week, and two dozen workers are set to receive payments between $5,800 to $21,000. On top of the cash compensation, they will also be placed on a preferential hiring list for a year in other Chipotle stores around Maine.

Meanwhile, Chipotle said in a statement it chose to settle the suit because a court battle is expensive and would have been troublesome on its part. The company said it respects its employees’ rights to organize under the National Labor Relations Act and is committed to establishing a fair and just work environment for all.

“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,” Chipotle’s chief corporate officer, Laurie Schalow, said in a statement to CNBC.

Photo by: Atomic Taco/Flickr (CC BY-SA 2.0)