Topics

Starbucks is ordered to give union baristas a pay raise

A court has decided the workers are entitled to the same increase their nonunion colleagues were awarded last year.
All Starbucks employees will now be on the chain's new pay scale. | Photo: Shutterstock

Starbucks has been ordered by a federal judge to provide union employees with the increased pay and other benefits they were denied when the coffee chain voluntarily bestowed those extras last year on employees in units that hadn’t organized.

The chain had contended at the time that any changes in the pay or benefits of workers in organized stores needed to be negotiated with the employees’ union representatives, not arbitrarily decided by management. It argued that union baristas’ employment particulars could not be changed without worker and union ratification of new labor contracts.  

At the time, the parties couldn’t even agree on what form the negotiation meetings should take.

While that back-and-forth on the meetings was beginning, Starbucks announced that it would raise the pay of non-union baristas nationwide to at least $15 an hour. Employees with at least two years of tenure would get a 3% increase.

In addition, employees of stores that had not unionized or begun the process were entitled to such perks as more leeway in what they could wear at work, extra meeting time with supervisors on advancement opportunities, stepped-up training and additional sick-leave time.

The plan by Starbucks was revealed in October 2021, with a stated start date of Aug. 1, 2022.

On Thursday, Administrative Law Judge Mara-Louise Anzalone ruled that awarding the extras solely to employees of stores that had not unionized or begun the organizing process was in effect a coercive tactic. She adjudged the offer of higher pay to nonunion employees to be an illegal suggestion the benefitting workers would lose money if they voted to unionize their stores.

She contended that the message was reinforced in the high volume of communication that followed between employees of Starbucks’ 9,000 corporate stores in the U.S. and the chain’s Seattle headquarters.

The judge ordered Starbucks to pay employees exempted from the pay increase a lump sum equal to what they would have earned under the new wage scale. The coffee giant was also directed to extend the same benefits to those workers that their nonunion colleagues enjoyed.

In addition, Anzalone ordered Starbucks to record a message from its CEO to all employees, explaining the court’s directives and spelling out the workers’ rights when looking to organize.

Starbucks said it intends to appeal the decision by the administrative law judge, or ALJ.

"We have consistently honored established organizing and collective bargaining rules and we plan to file exceptions to the ALJ’s recommendation," the company said in a message posted yesterday on its corporate-wide website, OneStarbucks.com. "The ALJ’s recommendation that Starbucks should, or could, have disregarded these rules creates an untenable situation — which has already been rejected by federal courts — where employers violate the law if they unilaterally include organizing or unionized employees when making changes in wages and benefits, and violate the law if they do not do so."

It also notes that the directive has to be accepted as an order by the National Labor Relations Board, the federal agency that monitors union elections. The Board could reject the administrative law judge's decision and change the sanctions. Until that happens, no actions are likely to be taken.

The decision was handed down as the tally of Starbucks units with a union in place hit 358. Votes by three additional stores are still being processed.

Employees of 81 stores have voted against unionizing.

In addition, the staffs of 16 units have petitioned the NLRB to hold a second election where they might vote out Starbucks Workers United.

Members help make our journalism possible. Become a Restaurant Business member today and unlock exclusive benefits, including unlimited access to all of our content. Sign up here.

Multimedia

Exclusive Content

Technology

Pipedream wants to take restaurant pickup underground

The startup uses robots and tunnels to move food from kitchen to car. It believes it can one day connect entire cities.

Financing

As CosMc's takes off, McDonald's operators want a piece of the action

The Bottom Line: But where that action should take place is the question. Many operators believe the brand should be a testing ground for McDonald's own beverage program.

Financing

Bad weather returns as a restaurant sales problem

The Bottom Line: Snow and cold in January kept customers from visiting restaurants. Here's why this might be a bigger influence in the future.

Trending

More from our partners