Starbucks contends with a new set of inconsistencies from the union
This week, Starbucks Workers United has turned its exaggerated social media campaign to the issue of negotiations. In filing their petitions to organize, the union fought to have their elections by individual store, insisting that each store is a unique unit that should bargain based on that store's needs. Now, in a complete turnabout, the union suggests that they will propose a single set of contract terms to cover multiple stores. The union, in its own writings, has acknowledged repeatedly that contract negotiations under normal circumstances take more than 1 year. With more than 230 stores now requiring negotiation it is not unreasonable to expect a considerable addition of time to the bargaining process.
The third parties behind Starbucks Workers United, SEIU and Workers United, have never achieved a contract for any company they represent that is as comprehensive or strong as what Starbucks has offered for 30 years without a union. Below is a list of the initial demands made by the Buffalo stores that range from absurd to impossible. Proposals such as these demonstrate that the union is ill-prepared to enter these negotiations.
For reference, here are the annual increases in the CPI (CPI-U) from the US Bureau of Labor Statistics.
Even with the peak of CPI at 9.1% in June of 2022, all Starbucks pay raises during those years have been greater than the CPI. The increase last month to a $15 minimum was for most partners a raise of more than 20% and therefore well exceeds this demand. To meet the union's ask of an "increase equal to the rise" of the CPI would in fact be a pay reduction from the increases that Starbucks has always paid. Perhaps with a little research about their employer the union would have known this.
In 2022, Starbucks spent an additional $1 billion on employee compensation with multiple pay raises culminating the setting of a $15 per hour minimum wage. The average hourly pay of a Starbucks partner rose by $3 and is now $17 per hour. A partner working 25 hours per week received an annual raise of $3,897. At 35 hours per week they have seen their annual earnings rise by $5,456.
The commitment to these raises was published in the Starbucks 2020 Global Environmental and Social Impact Report published on April 27, 2021, well in advance of any union activity.
This is very unlikely to become reality. In 2020, only 4% of large firms (200 or more workers) paid 100% of premiums for individual plans and only 1% paid 100% for family plans (KFF, 2020). While Starbucks is a large company (~$100 billion market cap) they are not that large.
Starbucks subsidizes 75% of partner health insurance premiums which is greater than anyone else in the industry and more than is paid by 80% of US companies of comparable size. In a comparison of a Starbucks silver plan with the silver plan of a unionized major US airline, the airline plan is more than two times the price in premium but the deductible and out-of-pocket costs are only 10% more favorable than the Starbucks plan.
Starbucks partners also receive fully paid college tuition, an excellent low-cost 401k with immediate 5% match, stock purchase and stock grants, and paid parental leave which fewer than 25% of US companies offer at all. We have the best benefits in our industry by a considerable margin.
I can’t figure out how this even makes sense. Our tips average around $1 per hour. Sometimes more, sometimes less. Our wages are our guarantee. Tips are a bonus, a gratuity, provided by our customers. In effect this demand is for an extra $4.50 in hourly wages. Tips are not guaranteed. This is absurd.
Starbucks has been exploring this, however, it is not as simple as throwing a switch and comes with certain added complexity and time considerations in the point of sale process.
Personally, as a partner who works almost exclusively on window, I don’t want to slow my window times by having the customer enter a pin and then a tip, probably goof it up and start it over again. Most of my card tendering customers are dropping cash in the box. The ones who don’t aren’t going to tip no matter how they pay. As Starbucks is already the measured to have the longest drive through times in the industry this will only add noticeable time to the process.
This is like asking for a bonus because you showed up today. Of course, Starbucks is a tough and demanding job even when we’re fully staffed. It’s the only food service job I’ve worked since college, 35 years ago, but I understand the reasons why Starbucks is so much more demanding.
We’ve had days recently where five people have called off in one day. There are almost always two or more. Call-offs are a nationwide epidemic and not only to Starbucks. The union uses the short staffing caused by the call-offs to claim that Starbucks is intentionally understaffing while this is in fact demonstrably untrue. If we’re severely short staffed, we turn off MOP temporarily or in extreme cases operate as drive through only. Our manager and SSVs run the store with what we’ve got, and we get through it.
It think it takes too many write-ups and consultations up the chain to eliminate the problem people. The red tape does however protect the partners from perhaps being terminated too soon and for the wrong reasons. The staff shortages we encounter most often aren't because of issues in scheduling, they are the result of partners not taking this work seriously and calling off too frequently without accountability.
Nobody else in the industry does this. The company made free items available every day during the height of the pandemic because of store closures and drastic cuts in our hours. Starbucks still allows a very generous 7 food items marked out per week if you work at least one shift. Some chains provide only a discount and nothing for free even on the day you work. This offering during exigent circumstances was expressly deemed temporary yet some people have decided it is rather an entitlement.