Chipotle Mexican Grill received a lawsuit based on a controversial federal rule. The plaintiffs are employees at the fast casual restaurant who did not receive overtime pays for their extra hours they worked. All allegations depend on a federal rule that expanded the types of employees that are entitled to such bonuses. On the other hand, the Labor Department received an injunction last year that hindered it to enforce that particular rule.
A Controversial Federal Rule about Overtime Pays Might Still Be Active Despite an Injunction
On Wednesday, Chipotle employees filed a class-action lawsuit with the U.S. District Court in New Jersey. The case goes after Chipotle Inc. that didn’t honor a particular federal rule. According to this regulation, the company has to pay a time and a half to all employees who are clocking at least 40 hours of work each week. However, the rule limits the bonus only to those who earn less than $47,476 a year.
Chipotle employees’ lawyers claim that the controversial federal rule is valid from a legal point of view. Their argumentation brought up the date of December 1 when the court issued the injunction. However, the same court has never released a final decision. This means that the regulation was not actually repealed.
“We think the rule went into effect and that companies should be paying people overtime.”
The Outcome of This Lawsuit Might Change the American Labor Market
The legal procedure was a construct of the Obama administration in an effort to level up the income threshold from $23,660 to $47,476 a year. The method the officials found most eligible to undertake such a change was through overtime pays.
Neither Chipotle nor the Labor Department commented on this lawsuit. The company has gone through many other issues recently. However, if Chipotle employees manage to win this legal battle, there are going to be some major changes. First of all, Chipotle management might decide to alter work schedule and back pay their employees. Secondly, this trial might concern millions of other workers who would earn the right to overtime pays according to the federal rule.
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