NYC Pension Funds Call On Chipotle to Adopt Noninterference Policy

New York City Comptroller Brad Lander has filed a shareholder proposal at Chipotle, calling on the restaurant chain to adopt and disclose a policy of noninterference with employees’ efforts to unionize.

In last week’s announcement, Lander said he filed the proposal on behalf of the five New York City pension systems, which own a total of 48,870 Chipotle shares worth approximately $83.3 million as of April 5. He said Chipotle has demonstrated a pattern of anti-union tactics and retaliatory firings.

Lander noted that the company was recently ordered to pay more than $20 million to 13,000 workers for violating New York City’s worker protection laws and that the National Labor Relations Board said recently that Chipotle violated federal labor law when it closed a restaurant where workers voted to unionize. Chipotle was ordered to reopen the Maine restaurant and reinstate dislocated employees’ jobs with back pay.

“As long-term shareholders we expect responsible employers to respect the labor rights of their workers,” Lander said in a release. “Chipotle must catch up with companies like Microsoft that have recognized that noninterference with worker organizing is a basic standard for responsible employers.”

Lander said Microsoft recently adopted company-wide noninterference principles and announced a “labor neutrality agreement” at Activision Blizzard.

The proposal asks Chipotle’s board to adopt a noninterference policy aligned with the International Labor Organization’s Declaration on Fundamental Principles and Rights at Work. The proposal also requests the policy require “timely collective bargaining” and that it prohibit Chipotle from interfering with workers who exercise their right to form or join a trade union. It also calls for the creation of “robust accountability processes” to be applied if the policy is violated.

“Chipotle has repeatedly interfered with workers’ exercise of fundamental rights in violation of international standards and/or applicable law,” says the proposal’s supporting statement, adding that alleged intimidation tactics include firings, restaurant closures, anti-union consultants and captive audience meetings. “Chipotle’s failure to similarly respect workers’ rights presents meaningful reputational, legal, and operational risks that may negatively impact long-term shareholder value.”

According to the proposal, the noninterference policy should contain the following commitments:

Non-interference when employees exercise their right to form or join trade union, which

includes prohibiting Chipotle from undermining this right or pressuring employees seeking to form or join a trade union;

Good faith and timely collective bargaining if employees form or join a trade union;
Where national or local law is silent or differs from international human rights standards,

Chipotle will follow the higher standards; and

Processes to identify, prevent, account for and remedy any practices that violate or are

inconsistent with the policy.

Representatives from Chipotle did not respond to a request for comment.