Starbucks Workers at Unionized Cafes to Receive Pay Hikes in Breakthrough Agreement with Union
Starbucks has reached a breakthrough agreement with Workers United, an affiliate of the Service Employees International Union, to provide pay hikes for workers at unionized cafes. This move comes as the coffee giant aims to resolve a standoff over bargaining and improve its relationship with the union.
The wage increases are seen as a sign of good faith from Starbucks towards Workers United. The company has agreed to grant the same pay hikes that their nonunion coworkers received in May 2022. This development follows mediation discussions between the two parties, which took place last week as part of litigation over Workers United’s use of Starbucks’ branding.
In a joint announcement, Starbucks and Workers United stated that they have found a “constructive path forward” and will begin discussions on a foundational framework for collective bargaining agreements. This marks a significant thawing in their relationship since the first Starbucks location unionized in December 2021.
Under the agreement, Starbucks will implement wage increases based on employees’ tenure. Those who have been with the company between two and five years will receive either a 5% increase or be paid 5% above the market’s start rate, whichever is higher. Workers with more than five years of tenure will receive a 7% increase or earn 10% more than the market’s start rate, again, whichever is higher.
It is worth noting that these wage hikes were initially implemented in May 2022 under the leadership of former CEO Howard Schultz. However, Schultz faced criticism from Workers United, politicians, and customers for his aggressive campaign against the union. The current CEO, Laxman Narasimhan, who has been in the role for nearly a year, is now working towards improving the company’s relationship with the union.
In addition to the pay hikes, Starbucks has also committed to providing credit card tipping for unionized cafes. This benefit has been available in nonunion stores for over a year, and its extension to unionized cafes further demonstrates Starbucks’ efforts to bridge the gap between the two sides.
Overall, this breakthrough agreement between Starbucks and Workers United represents a significant step forward in their relationship. By granting pay hikes and extending benefits to unionized cafes, Starbucks is showing its commitment to improving working conditions and fostering a more positive environment for its employees. As discussions continue on collective bargaining agreements, it remains to be seen how this agreement will shape the future of Starbucks’ relationship with Workers United and its impact on the broader labor movement within the company.
