Starbucks union fight moves to Congress with labor talks stalled

Starbucks Corp. and chain baristas are more than 18 months into a fight over unionizing cafes at the world’s largest coffee company. Neither side has gotten all that they wanted.

Starbucks has managed to slow down new union petitions over the last year and a half. But the push has cost it operationally and financially, some company executives and labor attorneys say. Starbucks said it has spent millions of dollars on lawyers to oversee union elections, fight litigation and represent itself before the National Labor Relations Board, the federal body that oversees labor matters between U.S. companies and workers.

Thousands of U.S. baristas across 290 Starbucks stores have voted to unionize for better pay and working conditions but are missing out on many new perks offered by the company in the last year to nonunion workers. Those benefits include an additional round of employee pay increases, tipping from credit and debit card transactions, and faster sick-time accrual.

On Wednesday, Howard Schultz, who stepped down as CEO earlier this month, is slated to testify before a U.S. Senate committee on the company’s response to the union drive. Sen. Bernie Sanders (I., Vt.) has alleged that Starbucks under Mr. Schultz’s leadership has prevented baristas from organizing. 

STARBUCKS CEO TALKS ‘REINVENTION’ PLAN AHEAD OF FIRST SHAREHOLDERS MEETING

Mr. Schultz is expected to talk about the company’s legacy of providing better pay and benefits than many other retailers. 

Last week, a Republican congressional committee chaired by Rep. Virginia Foxx (R., N.C.) issued a subpoena to the NLRB, alleging that employees of the labor body mishandled union elections at Starbucks cafes in ways that favored unionizing workers. The House Committee on Education and the Workforce is seeking documents about the NLRB’s handling of at least one Starbucks union election.

Starbucks has faced union drives before in its more than 50-year history, but no other campaign has had such far-ranging results. 

Since August 2021, U.S. baristas have sought to form unions representing individual Starbucks cafes, saying such steps are necessary to secure better pay and working conditions. 

The NLRB said it has certified unions at 290 Starbucks stores, representing roughly 3% of the chain’s 9,300 U.S. locations. The agency has certified defeats for unionization votes at 58 locations, it said. The NLRB has recorded more petitions for union elections at individual Starbucks locations in the past decade than at any other company, an analysis of agency records show.

The conflict between Starbucks and the unionizers is unlikely to be resolved soon. 

STARBUCKS WORKERS PROTEST AHEAD OF SHAREHOLDER MEETING

Starbucks said it has held 87 bargaining sessions since last October. It hasn’t signed a union agreement as the two sides have largely disagreed on the format of the bargaining sessions. 

Starbucks has urged baristas to directly work with the company to address their goals. The company has hired a 25-person labor relations team to train managers on labor law and to bargain. New CEO Laxman Narasimhan, who took over the role in March, said he plans to continue the company’s approach to unionization and that the company needs to do more to listen to workers. 

Starbucks has recorded record revenue in recent quarters, though it has said that higher labor, ingredient and other costs are eating into profit. Executives have said consumer demand hasn’t slowed for its drinks even as it has raised prices. 

Negotiating a first contract with a union can often take 18 months, labor attorneys said, a process that they said can add costs and divide management and workers. 

At Starbucks stores, cafes that have unionized are averaging higher turnover than ones without representation, said A.J. Jones II, Starbucks’s head of public affairs. Unionized stores are more frequently understaffed, contributing to longer wait times for orders in those stores, Mr. Jones said. 

"Customers get frustrated," Mr. Jones said. 

JUDGE SAYS STARBUCKS COMMITTED ‘EGREGIOUS AND WIDESPREAD’ LABOR VIOLATIONS FIGHTING UNIONS

The union has filed hundreds of unfair labor practice complaints with the NLRB against Starbucks over allegations that include the harassment and firing of pro-union workers. Starbucks has contested the allegations, saying the company respects workers’ right to organize.  

The Starbucks Workers United union organizing baristas blamed the company for creating an inhospitable environment for workers looking to unionize, making some employees miserable. Union representatives said Starbucks should sit down with its unionized employees to negotiate rather than blaming them for store operation problems.

A union spokeswoman said: "We would love to have a collaborative relationship so we can make our stores better, and we can move on to what we love doing, which is serving our customers."

The unionization dispute has spread to some workers at Starbucks’s headquarters. 

Around 160 Starbucks corporate employees recently signed a public letter asking the company to revise its return-to-work policies and to commit to a policy of neutrality on union organizing. 

CLICK HERE TO GET THE FOX BUSINESS APP

The letter said: "We love Starbucks, but these actions are fracturing trust in Starbucks leadership."

Starbucks executives said those who expressed concerns in the letter represent a small share of their more than 3,750 headquarters-based employees and that the company is listening to their concerns.