retail news in context, analysis with attitude

Chipotle got bad news this week that had nothing to do with the food safety issues that have hurt its image, sales and profits over the past few months - it was ordered by an administrative law judge to pay back wages to a former employee fired because he posted critical messages about Chipotle on his personal Twitter account.

The Washington Times reports that "James Kennedy, 38, was terminated from a Havertown, Pennsylvania, location in February 2015, two weeks after he landed in hot water with management over his social media posts." Those posts criticized Chipotle's labor and pay policies.

According to the story, "Mr. Kennedy ultimately deleted the post after a supervisor told him it violated a social media policy that barred 'disparaging, false' statements about Chipotle. Two weeks later, he was fired after being disciplined for a petition he circulated among co-workers that objected to the restaurant’s policy for employee breaks.

"In Monday’s ruling, Judge Susan A. Flynn ruled that Chipotle violated the National Labor Relations Act by enforcing an illegal social media policy and directing Mr. Kennedy to stop circulating the petition ... Judge Flynn ordered Chipotle to offer Mr. Kennedy his job back and compensate him for lost work. Additionally, she said, the company must post signs at several locations acknowledging its social media policy violated federal labor law."

In other Chipotle news, the Wall Street Journal quotes Chipotle CFO Jack Hartung as saying that even if the beleaguered fast food retailer manages to regain competitive traction after a series of serious food safety issues, as much as seven percent of its customer base will never return.

"This is going to be messy,” he said at a retail and technology conference. “It’s worse than I thought."
KC's View:
If Hartung thought this wasn't going to be this messy, then he wasn't paying attention.

As for the social media issue ... it just reflects the degree to which companies have to be more conscious than ever about how they are perceived by employees ... because those employees can have an enormous impact on how companies are perceived. It always has been an article of faith around here that, ideally, employees are a business' best ambassadors. Now, it is a reality ... and they also can be a business's worst enemy.