Guzman y Gomez Closes All US Restaurants May 25: Labor Lawsuit Filed

Guzman y Gomez Mexican Kitchen, an Australian-born fast-casual chain that positioned itself as a Chipotle competitor, has permanently shut down all nine of its Chicago-area restaurants effective May 22, 2026. The abrupt closure came with virtually no warning to employees, who discovered the news through leaked corporate emails rather than official company communication. This sudden exit marks a dramatic reversal for a brand that once planned to expand hundreds of locations across the United States. The shutdown has triggered a federal class action lawsuit from former workers alleging serious labor law violations under Illinois’ Worker Adjustment and Retraining Notification (WARN) Act.

Guzman y Gomez Sudden Closure Shocks Chicago Market

Guzman y Gomez Mexican Kitchen announced the permanent closure of all US operations on its website and Instagram, stating “All GYG USA restaurants permanently closed” effective May 22nd. The chain operated nine locations across the Chicago area after entering the market six years ago with ambitious expansion plans. The closure ended the company’s American restaurant venture without advance notice to staff or customers.

Employees Left in the Dark Over No-Notice Closure

About a dozen former employees protested outside the shuttered Evanston location on Saturday, holding signs against the sudden closure. Workers reported learning about the shutdown Thursday night through a leaked corporate email rather than official management communication. Staff members received no formal notice before the restaurants ceased operations, leaving them without severance information or transition support.

Federal Class Action Lawsuit Over WARN Act Violations

Former Guzman y Gomez workers filed a class action lawsuit in the United States District Court Northern District of Illinois, alleging the company violated the WARN Act by failing to provide adequate notice before closure. The WARN Act requires employers to give workers 60 days’ advance notice of mass layoffs or facility closures. The lawsuit seeks damages and relief under both state and federal labor protection laws, highlighting serious compliance failures in the company’s exit strategy.

Restaurant Industry Labor Practices Under Scrutiny

The Guzman y Gomez closure exposes ongoing labor law compliance issues within the fast-casual restaurant sector. No-notice closures violate worker protections designed to help employees prepare for job loss and access unemployment benefits. This incident reinforces the need for stronger enforcement of labor standards across the restaurant industry, particularly for chains operating multiple locations that should have resources to comply with legal requirements.

Final Thoughts

Guzman y Gomez’s abrupt closure of all US restaurants without employee notice represents a significant labor law violation with serious consequences for affected workers. The federal class action lawsuit signals growing accountability for companies that fail to comply with the WARN Act and other worker protections. This case underscores the importance of regulatory enforcement in protecting restaurant workers during business transitions.

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