Starbucks to increase wages, improve benefits for 150K employees
FBN's Maria Bartiromo on Starbucks' plans to boost wages and benefits for 150,000 employees due to the tax reform legislation.
Starbucks said Wednesday it will increase wages and enact other perks for more than 150,000 U.S. employees as a direct result of recent tax reform, joining other corporations in rewarding workers.
The Seattle-based coffee chain is giving all of its U.S.-based hourly and salaried workers an unspecified raise in April, in addition to a wage increase already dispersed earlier in the Starbucks’ fiscal year, which began last October. Starbucks says it is investing roughly $120 million in the wage increases.
Starbucks is also awarding workers stock grants worth a total of more than $100 million to those employed by the chain as of Jan. 1, 2018. Retail employees will receive at least a $500 grant, while store managers will receive grants of $2,000, the chain said.
Grants will be dispersed based on employment level on April 15 to all full-time, part-time, hourly and salaried employees in the country. In addition to the financial rewards, Starbucks is installing a new sick time policy that will allow employees to accrue sick days based on hours worked, as well as an expanded parental leave policy.
“Today, we are proud to announce additional investment in stock, wages and a new partner and family sick time benefit that will further enhance our industry-leading approach. Just as we have always felt strongly that our partners are key to our business success, we have also known offering a valuable, comprehensive benefits package helps us retain our valuable partners,” Starbucks CEO Kevin Johnson said in a statement.
Starbucks said its total investment in the new employee rewards and benefits will top $250 million. The company will provide more detail about how the initiatives will impact its full-year financials when it reports first quarter earnings on Jan. 25.
The GOP-backed tax plan slashed the corporate tax rate to 21% from 35%. The prospective savings prompted several major corporations, including Apple, AT&T and the Walt Disney Company to grant bonuses, wage increases and other rewards to their employees.