CARLSBAD Calif. Rubio's Restaurants Inc., whose Rubio's Fresh Mexican Grill fast-casual chain has more than 160 units, on Monday said it had agreed to settle a previously disclosed class-action lawsuit by workers over their alleged misclassification as exempt from overtime-pay entitlement.
Rubio's, which reiterated its denial of the allegations, said $7.5 million would be paid to the plaintiffs in three installments, with the first one-third due within 60 days of court approval of the settlement. Two more $2.5 million payments would be made, one 18 months after the approval, and the last 36 months after the approval date.
Accompanying the final payment would be $337,500 in financing charges, equal to 3 percent of the settlement. As a result, Rubio's said, it will record a one-time pre-tax charge of $8.4 million in fiscal 2006's fourth quarter, including legal costs.
