Aussie fast-food chain facing legal action after shutting down US operations
Former workers say the company gave no 60-day notice before closing eight Chicago-area restaurants, and more than 500 employees were affected, the lawsuit says.
- On Friday, Australian-founded restaurant chain Guzman y Gomez abruptly closed all eight Chicago-area locations, prompting former workers to file a federal class action lawsuit on Sunday alleging violations of the Worker Adjustment and Retraining Notification Act.
- Founder and CEO Steven Marks stated the company evaluated the business trajectory with the board, concluding the path to required performance 'was not there,' prompting the exit from the United States market after six years.
- Shift leader and lead plaintiff Yomira Gomez said employees received no advance notice before operations ceased Thursday night, leaving staff like Joseph Guzman facing financial instability and limited severance pay.
- While the lawsuit claims GYG failed to provide the mandated 60 days' notice, investors reacted positively to the US exit, sending the company's share price soaring 20 per cent on Friday.
- Marks reaffirmed the company's focus on its long-term target of 1,000 restaurants across Australia, as the closure leaves Chipotle as the dominant player in the American fast-casual Mexican market.
15 Articles
15 Articles
Australia’s Guzman y Gomez sued in US over alleged failure to notify staff of closure - Regional Media News
May 25 (Reuters) - A group of U.S. employees have sued Sydney-listed Guzman y Gomez in an Illinois court, alleging the Mexican-themed fast-food chain did not give prior notice to staff before closing all its Chicago restaurants, a court document showed on Monday. Guzman y Gomez, a Mexican-themed restaurant chain whose global growth plans powered a blockbuster share market listing in 2024, last week said it was quitting the U.S. due to poor sales…
Strategy is avoiding the slaughterhouse: Ritson on GYG's US folly
Last week was a good one for Guzman y Gomez’s share price. The Australian Mexican restaurant chain started the week at $17 and finished it at $21. The reason for the 23% jump? Failure. Recognised failure. On May 22, the Mexican burrito chain announced it was shutting all Chicago operations with immediate effect. The decision triggered a $30m to $40m profit-and-loss write-off in FY26, with cash costs capped at $15m. And the market loved it. That …
Former Guzman y Gomez workers file class action lawsuit over alleged labor law violations
Former workers of Guzman y Gomez are alleging the company violated Illinois’ Worker Adjustment and Retraining Notification (WARN) Act by failing to give adequate notice before closing its eight Chicago-area locations and filed a lawsuit Sunday in federal court. The class action lawsuit, filed in the United States District Court Northern District of Illinois, seeks seeks only damages and other relief permitted under the state and federal WARN Act…
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