Starbucks Offers Pay and Benefits Increase, Excluding Unionized Workers
Starbucks is set to increase pay and benefits for its U.S. hourly workers following a successful fiscal year of record sales. However, the company’s decision to exclude unionized workers from these perks demonstrates the ongoing tension between the coffee giant and the Workers United union.
Since 2021, approximately 366 Starbucks stores across the U.S. have voted to unionize. Despite this, no labor agreement has been reached between Starbucks and the Workers United union at any of these stores. Starbucks currently operates 9,600 company-owned stores in the U.S.
Starting from January 1, Starbucks plans to increase wages, which currently average $17.50 per hour. Employees with four years of service or less, regardless of whether they work in unionized or non-unionized stores, will receive raises of 3% or 4% depending on their years of service. Employees with five years or more of service will be eligible for a 5% increase. However, as this is a new benefit, it must be negotiated with Workers United and is not currently available to unionized stores.
Workers United has rejected Starbucks’ claim and intends to file unfair labor practice charges against the company with the National Labor Relations Board (NLRB). The union argues that withholding benefits from unionized stores is illegal.
In addition to wage increases, Starbucks is shortening the time required for hourly employees to accrue vacation days from one year to 90 days. However, this benefit is only available to workers in non-unionized stores.
Moreover, Starbucks has announced a new North American barista championship that is open to employees in the U.S. and Canada, but not to employees at unionized stores due to the inclusion of prize money and travel.
It’s worth noting that Starbucks’ actions contradict a September ruling by an administrative law judge for the NLRB. The judge ruled that Starbucks acted illegally when it raised pay exclusively for non-union workers last fall. Starbucks is appealing this ruling, arguing that the NLRB’s standards do not permit employers to unilaterally change the wages or benefits of unionized employees.
