This site uses cookies. By continuing to browse the site you are agreeing to our use of cookies.
From labor disputes cases to labor and employment publications, for your research, you’ll find solutions on Bloomberg Law®. Protect your clients by developing strategies based on Litigation...
A group of Chipotle Mexican Grill Inc. workers say the fast-food chain owes them time-and-a-half pay under the Obama administration overtime rule that a federal judge in Texas put on hold last year ( Alvarez v. Chipotle Mexican Grill, Inc. , D.N.J., docket no. not available, complaint filed 6/7/17 ).
The workers allege in a complaint filed June 7 in federal court in New Jersey that the company is required to comply with the Fair Labor Standards Act regulation, which the Department of Labor estimated would have made about 4.2 million workers newly eligible for overtime pay. The rule more than doubled the salary threshold under which employees are automatically eligible for overtime.
The workers say the regulation went into effect as scheduled Dec. 1, even though Judge Amos Mazzant of the U.S. District Court for the Eastern District of Texas granted a preliminary injunction Nov. 22. He said the DOL and its Wage and Hour Division were “enjoined from implementing and enforcing” the overtime rule.
Joe Sellers, a lawyer for the workers, told Bloomberg BNA that “the Administrative Procedure Act provides that rules, once they are issued for final publication with an effective date, automatically go into effect on that date unless the court issues a final adjudication vacating that rule.” The DOL published the final rule May 23, 2016.
“The rule automatically goes into effect,” said Sellers, a partner with Cohen Milstein Sellers & Toll PLLC in Washington. “The Department of Labor doesn’t implement the rule. The rule goes into effect on its own.”
In terms of legal procedure, Mazzant’s injunction isn’t considered a final adjudication. A motion for summary judgment, which would be a final adjudication if granted, is pending in Mazzant’s court. Meanwhile, an appeal of the preliminary injunction the DOL initiated under President Barack Obama is pending in the U.S. Court of Appeals for the Fifth Circuit.
Paul DeCamp, a former administrator of the DOL’s Wage and Hour Division under President George W. Bush, said the rule didn’t take effect. “The whole purpose of issuing the injunction was to prevent the rule from going into effect in the first place,” he told Bloomberg BNA June 7. “Otherwise, there would have been no purpose in issuing the injunction.”
“The argument that the plaintiffs seem to be making is a reach,” DeCamp said.
“The injunction bars not only the enforcement but the implementation of the regulation in the first place. It means that the final rule that was issued in 2016 never became effective,” he said. DeCamp now represents employers in wage-and-hour matters as a principal in the Washington, D.C., region office of Jackson Lewis P.C.
Chipotle denied wrongdoing. “I’d note that all of our employment practices are compliant with applicable laws,” Chris Arnold, a Chipotle spokesman, told Bloomberg BNA in an email. “I would also note that a lawsuit is nothing more than allegation, and is proof of absolutely nothing.” He declined to comment in greater detail because the litigation is ongoing.
The lawsuit comes as the DOL mulls whether to continue its appeal of Mazzant’s decision. It plans to seek public input on what to do with the rule, Labor Secretary Alexander Acosta told lawmakers June 7 at a House Appropriations subcommittee hearing on the department’s budget. Critics of the overtime rule said it would likely force businesses to cut jobs to meet rising payroll costs.
The next deadline in the DOL’s appeal of Mazzant’s injunction is June 30. The DOL under President Donald Trump asked for and received delays in the proceeding to allow incoming leadership time to evaluate the agency’s position.
In addition to Sellers, Miriam Nemeth of Cohen Milstein in Washington represents the workers. They’re joined by Justin Swartz and Melissa Lardo Stewart with Outten & Golden in New York City and Glen Savits with Green Savits LLC in Florham Park, N.J.
—With assistance from Chris Opfer.
To contact the reporter on this story: Jon Steingart in Washington at jsteingart@bna.com
To contact the editors responsible for this story: Peggy Aulino at maulino@bna.com; Terence Hyland at thyland@bna.com
Text of the complaint is available at http://src.bna.com/pAw.
Copyright © 2017 The Bureau of National Affairs, Inc. All Rights Reserved.
All Bloomberg BNA treatises are available on standing order, which ensures you will always receive the most current edition of the book or supplement of the title you have ordered from Bloomberg BNA’s book division. As soon as a new supplement or edition is published (usually annually) for a title you’ve previously purchased and requested to be placed on standing order, we’ll ship it to you to review for 30 days without any obligation. During this period, you can either (a) honor the invoice and receive a 5% discount (in addition to any other discounts you may qualify for) off the then-current price of the update, plus shipping and handling or (b) return the book(s), in which case, your invoice will be cancelled upon receipt of the book(s). Call us for a prepaid UPS label for your return. It’s as simple and easy as that. Most importantly, standing orders mean you will never have to worry about the timeliness of the information you’re relying on. And, you may discontinue standing orders at any time by contacting us at 1.800.960.1220 or by sending an email to books@bna.com.
Put me on standing order at a 5% discount off list price of all future updates, in addition to any other discounts I may quality for. (Returnable within 30 days.)
Notify me when updates are available (No standing order will be created).
This Bloomberg BNA report is available on standing order, which ensures you will all receive the latest edition. This report is updated annually and we will send you the latest edition once it has been published. By signing up for standing order you will never have to worry about the timeliness of the information you need. And, you may discontinue standing orders at any time by contacting us at 1.800.372.1033, option 5, or by sending us an email to research@bna.com.
Put me on standing order
Notify me when new releases are available (no standing order will be created)