Starbucks union urges coffee giant to extend pay rises and perks to unionized stores – CNBC | Gmx Pharm

With wage increases set to take effect Monday at Starbucks coffee shops across the US, work organizers are urging the coffee giant to extend the benefits to unionized stores without having to go through the negotiation process.

The move comes after Starbucks announced in May it would increase wages for workers and add other benefits like credit card tips by the end of this year. But the Seattle-based coffee chain said it would not offer the expanded benefits to workers in unionized stores because it would have to negotiate to make such changes.

In a letter to Starbucks CEO Howard Schultz obtained by CNBC, Workers United said the company can legally offer benefits to workers in unionized stores without negotiation, as long as the union agrees. The letter points to other company-wide benefits announced in recent months, including faster accumulation of sick leave and reimbursement of medical travel expenses for employees who desire an abortion or gender-matched care.

“Workers United refuses to stand by while Starbucks cynically promises new benefits only to non-union workers and withholds them from our members,” read Workers United President Lynne Fox’s letter to Schultz last month.

The letter notes that the union is not waiving any other bargaining obligation Starbucks has under federal law.

About 200 Starbucks stores have unionized so far, according to the National Labor Relations Board, while 40 have voted against. Starbucks has around 9,000 stores in the United States

When contacted about the union’s request, Starbucks referred to a fact sheet on its website, which said, “The law is clear: once a store unionizes, no changes in benefits are allowed without good faith collective bargaining.”

The company’s website states that workers have access to Starbucks benefits that were in effect at the time the union application was filed, but that any subsequent changes to wages, benefits and working conditions must be negotiated.

Labor lawyers say the case could end up before an administrative judge on the National Labor Relations Board.

“Once a union has been certified, an employer has an obligation to negotiate with that union before making any changes to terms and conditions of employment,” said Stephen Holroyd, a Jennings Sigmond lawyer who has represented unions and worked for the NLRB.

But he said the union greenlighting the benefits without negotiations is changing the situation and could argue that Starbucks is withholding the benefits because of its organizing campaign.

Daniel Sobol, an attorney at Stevens & Lee who has represented companies in union cases, said the NLRB and federal courts disagree on the issue.

“If [benefit enhancements are] just to prevent unionization that could be a problem,” he said. But as employers adjust wages in the inflationary environment, Starbucks may not be required to pay the raises to unionized employees.

Gabe Frumkin, an attorney for Starbucks Workers United, said it was clear the benefits would be offered in response to the union campaign. He said Workers United had filed two charges related to Starbucks’ wage and benefit announcements for non-union stores and was considering other options.

Catherine Creighton, director of Cornell University’s Industrial and Labor Relations School in Buffalo, New York, said the law requires companies to notify a union of a new benefit and the opportunity to negotiate it. But she said that “if the union says they have no objection, then the employer may well give them that benefit.”

The pay increases, which go into effect this week, include a pay rise of at least 5% or a raise to 5% above the market rate, whichever is greater, for employees with at least two years of experience. Employees with more than five years of experience will receive a minimum salary increase of 7% or a raise to 10% above market rate, whichever is greater. The increases come on top of a previously announced increase starting this month that brings wages to a floor of $15 an hour nationwide. This increase is available to stores that did not start organizing prior to the announcement.

Starbucks has announced it will spend $1 billion on pay increases, improved training and store innovations in fiscal 2022. When Schultz returned to his role as CEO for the third time, he suspended the company’s buyback program to invest in people and business.

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