Chipotle Employees Say They're Owed Overtime Pay Under Obama Era Rule

June 16, 2017

A group of Chipotle Mexican Grill Inc. employees have filed a lawsuit alleging the company illegally continued their exempt status in the wake of the Obama administration's overtime rule, claiming that the federal court ruling against the rule in November 2016 only applies to DOL enforcement actions.  According to one of the lawyers for the employees, "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," which the court has not done yet.  In terms of legal procedure, the judge's preliminary injunction isn't considered a final adjudication.  A motion for summary judgment, which would be a final adjudication if granted, is still pending in court.  The next legal deadline in the overtime case is June 30, 2017, when DOL must tell the court what it is going to do with the overtime rule.  While the workers' complaint is a novel and untested legal theory that may not prevail in court, it could force DOL to announce how it intends to proceed with the long-delayed rule.  On June 7, 2017, Labor Secretary Alexander Acosta told Congress at a House Appropriations subcommittee hearing on the Department's budget that he plans to seek public input on what to do with the rule, but he gave no timetable.