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Starbucks Unions Demand Extended Benefits, Starbucks to Raise Wages of its Employees

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Photo Credit: Jason Redmond/AFP via Getty Images

The recent union efforts of Starbucks employees prompted the company to increase its wages. In addition to the increase in salary – to take effect on Monday – labor leaders call for extended benefits. According to them, no bargain should be made in this case.

Following its employees’ efforts to organize into a union, Starbucks declared in May that it will raise the wages of its employees. The business has also stated that other benefits like credit card tipping come along with the wage increase. A Seattle-based Starbucks chain, however, stated that it would not extend the benefits since it must first go through a negotiation procedure.

In a letter to Starbucks CEO Howard Schultz, labor union officials argued that benefits might be provided to workers in unionized outlets without engaging in formal negotiations. The letter also highlights extra perks like quicker sick leave accrual and travel reimbursement for medical needs, particularly abortion and gender care.

Signed by the president of Workers United, Lynne Fox, the letter said, “Workers United refuses to stand by while Starbucks cynically promises new benefits only to non-unionized workers and withholds them from our members.”

Starbucks has 9,000 locations, with 200 already unionized. The National Labor Relations Board data shows that 40 are still in the voting process.

To provide a response, Starbucks said in a factsheet, “The law is clear: once a store unionizes, no changes to benefits are allowed without good faith collective bargaining.”

According to the website, while employees have access to the benefits that were available when they filed the petition, bargaining is permitted if it concerns subsequent changes to working conditions, benefits, and wages.

Legal lawyers say that the case can reach the administrative court of the National Labor Relations Board.

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Stephen Holroyd said, a lawyer at Jennings Sigmond, said, “Once a union has been certified, an employer is obligated to bargain with that union before making any changes to terms and conditions of employment.” Holroyd is best known for his expertise in labor unions; he has also worked for the NLRB.

Holroyd went on to say that the union’s move could imply that Starbucks is acting solely in response to unionization efforts.

Several benefits to be claimed

A Stevens & Lee attorney, Daniel Sobol, said federal courts and the NLRB have different views on the matter.

“If [ benefit enhancements are] done solely to chill unionizing, that could be an issue,” Sobol explained. Furthermore, he argued that Starbucks might not be required to raise wages for unionized employees due to inflation.

Starbucks Workers United’s attorney said their team had filed two more cases. He added that the benefits currently offered by Starbucks are clearly a response to efforts to chill its employees.

Catherine Creighton, director of the Industrial and Labor Relations school at Cornell University in Buffalo, New York, stated that “if the union says they have no objection, then the employer can absolutely give them that benefit.” She added that companies are required by law to send a notice to the union and offer an opportunity to bargain.

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During the latter half of its fiscal year 2022, Starbucks plans to invest more than $1 billion in employee wage increases, training, and store innovations. Starbucks’ CEO canceled the company’s stock buyback program so that it could devote its resources to improving its stores and increasing employee benefits.

The wage increase will go into effect this week. Employees with at least two years of experience will see a 5% increase in their pay. Those with more than 7 years of experience will receive a 7% or 10% increase above the market rate.

Source: CNBC

Based in LA, Alice Blake is a senior reporter for Kivo Daily. She primarily covers entrepreneurs.

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