Full Breakdown
Guzman y Gomez Shuts All U.S. Restaurants, Faces WARN-Act Lawsuit
5/25/2026, 6:15:59 AM
Abrupt Closure of Chicago-Area Outlets
On May 21, 2026, Guzman y Gomez (GyG) posted on its U.S. website and Instagram that all Chicago-area restaurants would close on May 22. The notice read, “All GYG USA restaurants permanently closed.” Employees learned of the decision through an internal message posted that evening and a leaked email received late Thursday, giving them no advance warning.
Expansion Ambitions and Market Realities
Founded in Australia by Steven Marks and Robert Hazan, GyG entered the U.S. in 2020 aiming to open “hundreds, if not thousands” of locations. The eight (some reports cite nine) Chicago-area sites were the first wave of a national rollout. Analysts have called the U.S. fast-casual Mexican segment a “graveyard” for Australian chains. In FY2025 the U.S. segment posted $12.2 million in sales but lost $13.2 million in EBITDA, more than double the FY2024 loss.
Data & Statistics
- Global workforce: >13,000 employees (primarily in Australia, Singapore, Japan).
- U.S. sites: 8 (Naperville, Schaumburg, Crystal Lake, Buffalo Grove, Deerfield, Des Plaines, Chicago Bucktown, Evanston).
- FY2025 U.S. sales: $12.2 million; EBITDA loss: $13.2 million.
- Australian share price rose from $18.05 to $21.10 after the exit announcement.
Official Statements & Corporate Rationale
GyG’s leadership said the U.S. venture required “significantly more time and capital” than expected and that continued investment would not justify shareholder returns. The company said it will refocus on its Australian network, targeting 1,000 restaurants and a 10 % EBITDA margin. No comment was given on the WARN-Act claims.
Criticism & Opposition
Workers claim GyG violated Illinois and federal WARN Acts, which require 60 days’ notice for mass layoffs affecting 75 + (state) or 100 + (federal) employees. Plaintiffs report only one night’s notice, pay through May 31, and three months’ severance for managers. Demonstrators at the Evanston store displayed signs demanding notice and severance, while employees noted reduced hours in the weeks before the shutdown, indicating prior knowledge.
Conflicting Reports & Gaps
Sources differ on the exact number of U.S. sites (eight vs. nine) and on which WARN Act threshold applies. It remains unclear whether GyG qualifies for the “capital-seeking” exception that could exempt it from the notice requirement.
Verbatim Quotes
- “All GyG USA restaurants permanently closed.” — GyG website statement
- “The message allegedly read: “After careful consideration, we have made the difficult decision to exit the US market.” — Internal GyG message to staff
- “There was no notice. It happened Thursday night and all operations were closed by Friday morning,” — Yomira Gomez, plaintiff
- “They did not give us any notice. We found out through a leaked email at 8:11 p.m. Thursday and then the company resent it roughly two hours later,” — Joseph Guzman, former employee
What’s Next
The class-action suit filed in the U.S. District Court, Northern District of Illinois, seeks damages under state and federal WARN statutes. GyG has not responded to comment requests. Workers plan further protests, and analysts expect continued scrutiny of the company’s U.S. exit as it concentrates on its Australian operations.
