A well-known fast food restaurant in New York, Shake Shack is known for its gourmet burgers and custard shakes.
In California, an ex-employee claimed that he was frequently asked "to explain his gender to coworkers."
A $20,000 settlement followed an investigation by the state's Civil Rights Department.
According to the state's Civil Rights Department, Shake Shack has resolved a California lawsuit in which a former worker claimed he was frequently asked "to explain his gender to coworkers."
According to a settlement announced on Monday, Danny Meyer's New York burger chain will pay the former worker $20,000.
In his complaint, the California employee claimed that he had experienced "discrimination, harassment, and retaliation based on gender identity and gender expression."
The worker claimed that after receiving training in San Francisco and being assigned to work in a store in Oakland, California, the alleged harassment began.
According to a Civil Rights Department press release issued on Monday, he claimed that he was "repeatedly misgendered by coworkers
and that when he complained, management failed to take reasonable steps to correct the behaviour."
The department claimed that management repeatedly advised him not to rely on them to stop discriminatory behaviour but rather to explain his gender to coworkers.
After just one month, the complainant left the company because he was frustrated by management's failure to address his concerns.
Kevin Kish, department director, stated that "intentional misgendering" in the workplace is forbidden by California law.
The state agency said that in addition to paying the former employee $20,000, Shake Shack has agreed to update its policies and training regarding retaliation, harassment, discrimination
Shake Shack issued a statement to Insider saying, "Creating a welcoming and fulfilling environment for all our employees and guests is critical."
We continuously take action to make sure that our culture and policies reflect our dedication to diversity and inclusion in the workplace.
According to Kish, "intentional misgendering" and other types of discrimination based on gender identity and gender expression can be traumatic and stressful.
Shake Shack's recognition of its obligation to provide a discrimination-free workplace to its employees is greatly appreciated by CRD.
Burgers, fries, and custard shakes are available at the fast food restaurant chain Shake Shake. More than 430 restaurants in the US and abroad are part of the chain.