More trouble at Chipoltes

In what could certainly be the beginning of the end for the company, Chipotle’s restaurants have been named the defendant in a class action lawsuit by roughly 10,000 employees, charging workers have been underpaid in wages. In order to meet budget objectives, Chipotle’s managers, and their staffs were required to “punch-out” and continue to work off the clock. Some workers claim that they were required to work as many as four hours after punching out of an 8-hour shift. Low paid and immigrant employees have little recourse to being forced to work unpaid overtime as they are threatened with termination if they refuse to stay late.

Chipotle restaurant franchises around the globe have been under pressure from lawsuits charging the company’s food handling procedures led to an outbreak of the deadly bacteria known as e-Coli. Another round of lawsuits has been filed that threaten the reputation of the company, once a wholly owned subsidiary of McDonald’s. The company is also being sued for misrepresenting the number of calories in its chorizo burrito. Store advertising showed that the spicy, sausage-filled burrito has a total of 300 calories, when in reality it has 1050 calories, over double the calories when compared to the Big Mac according to Chipotles online nutrition calculator.

Another scandal that has rocked the restaurant chain in recent years is Mark Crumpacker, a top executive at Chipotle’s corporate headquarters, who was put on leave after being arrested on cocaine charges and sent to drug rehabilitation. He has just recently returned to work. In 2014, 60 customers in 14 states became ill after eating at Chipotle restaurants sending the stock of the company down over 25%.

Food making its customers sick, misrepresentation of the nutrition data on its products, and now forcing workers to work unpaid overtime, all the while promoting a responsible, locally-grown, and healthy product and corporate image, all threaten the reputation and viability of the restaurant chain in the months to come. The stock is currently trading at around 50% of its all-time high.