American workers at Guzman y Gomez’s shuttered US stores have launched a class action lawsuit against the Mexican-themed Australian fast food chain over allegations staff were terminated without adequate pay or notice.
The legal claim, filed in a US federal trial court in Illinois, was sparked by GyG’s decision last week to immediately close its string of Chicago stores after giving up on its plans to expand in the US. Workers say they first heard about the imminent closures on 21 May via an internal message posted on the company’s message platform, according to the lawsuit filed by Chicago firm Haseeb Legal. The message allegedly read: “After careful consideration, we have made the difficult decision to exit the US market. This means we will be closing all our restaurants from today.”
The class action claims that GyG was required under federal and state laws to provide 60 days’ advance written notice before conducting a mass layoff. It is seeking pay and benefits for up to 60 days for every affected employee – estimated by the law firm to number more than 500 – and is seeking a trial by jury.
A GyG spokesperson said the firm “is aware of legal action filed in the United States and we are confident we have met all of our legal obligations to our US employees.” The Australian-listed food chain has recorded significant growth in its home country but its plans to break into a US market already rich with Mexican food and established competitors including Chipotle officially ended last week amid mounting losses.
The class action has two named plaintiffs, both of whom had been baristas who were promoted to shift leaders. One earned $US21 an hour and the other $US23 an hour, according to the claim. Neither received the required notice, nor required compensation, according to the class action allegations. While the legal action names GyG’s US entity as the defendant, it argues that the US operations and GyG Australia constituted a “single integrated enterprise” and employer, expanding the liability.
