This week’s news that 10,000 Chipotle employees filed a class action lawsuit claiming back wages, working off the clock and various labor violations should finally be the wake-up call necessary to get c-suite executives at restaurant, retail, hotel & lodging, convenience stores and other labor-intensive industries to take the issue seriously because the Chipotle case may be the tip of the iceberg.
For years, unions and labor-affiliated non-profits have quietly but aggressively developed a narrative that entry-level and hourly workers are routinely being underpaid and exploited by malevolent employers. The "wage theft" story line is central to union organizing efforts and the issue has been getting traction with labor-friendly policy makers and opinion leaders.
Most notably, New York Attorney General Eric Schneiderman is actively investigating and prosecuting wage theft cases against franchisees of two major brands. In
one case, a franchisee was sentenced to jail.
These will certainly not be the last cases like this. In fact, attorney general offices across the country have been beefing up their wage and hour compliance divisions to pursue wide-ranging wage theft investigations. Some of those offices have entered into agreements with private plaintiffs attorneys to pursue even more cases. And unions like nothing more than to see these types of headlines in the papers.
Business leaders need to get real smart, real fast on this issue and understand that a cottage industry of compliance, populated by labor-friendly attorneys general and the plaintiffs bar, has sprouted up to take aim at their brands — and pockets.