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March 30, 2023: Former Starbucks CEO, Howard Schultz, is expected to face tough questioning from Senator Bernie Sanders regarding the coffee chain’s alleged union busting during a Senate hearing on Wednesday. Sanders, a pro-union independent representing Vermont, has been putting pressure on Starbucks for over a year to recognize the union and negotiate contracts with unionized cafes. Schultz will defend Starbucks’ approach to negotiations, arguing that a direct relationship with workers is best for the company.
Schultz stepped down from his post on March 20th, handing the reins over to Laxman Narasimhan, who spent the prior six months learning about the company. Schultz remains on Starbucks’ board and is its fifth-largest shareholder, with a 1.9% stake in the company he turned into a global juggernaut.
As of Monday, 391 company-owned cafes have filed petitions to unionize, and 294 have voted to unionize under Starbucks Workers United, according to data from the National Labor Relations Board. In total, the union has made more than 500 complaints of unfair labor practices related to Starbucks with the federal labor board. Judges have found that the company has illegally threatened baristas, fired workers and prohibited union literature.
Starbucks has denied allegations of union busting and filed roughly 100 of its own complaints against the union. None of the unionized stores have agreed on a contract yet with Starbucks. An NLRB lawyer reportedly said Tuesday that the company’s refusal to bargain over Zoom was illegal.
Beyond lawmakers and regulators, Starbucks also faced pressure for its handling of the union push from investors. At the company’s annual meeting on Thursday, shareholders cast their votes for a nonbinding proposal that asked for a third-party probe into whether the company broke its commitment to workers’ rights. Starbucks hasn’t shared the official vote counts yet.
During Schultz’s third stint as CEO, which lasted just shy of a year, he moved aggressively to stem the organizing wave that began under his predecessor, Kevin Johnson. Schultz announced higher wages, better benefits and card tipping for non-union locations as well as a reinvention plan that included automating tasks that baristas found tedious.
