Starbucks workers have unionized at record speed; many fear retaliation now

Starbucks workers are busy this fall, and not just with making pumpkin spice lattes. This month, workers from hundreds of unionized Starbucks stores are expected to sit down for collective bargaining for the first time, while others will vote in still more union elections to come.

So far, more than 300 Starbucks stores in close to three dozen states have had union elections — a stunning number, given not a single company-owned store had a union at this time last year. Even more remarkable is that 80% of them, or around 245 stores, have gone in favor of forming a union.

In the past week, Starbucks locations in Washington, D.C., Albuquerque, N.M., and Westlake, Ohio, became the latest to join the national union Workers United.

The impressive numbers showcase how Starbucks baristas have turned a grassroots campaign into a national labor movement with lightning speed.

But they hide another plain truth, which is that unionized stores make up less than 3% of the 9,000 company-operated Starbucks stores around the country. What's more, the number of stores petitioning to hold union elections has dropped dramatically in recent months. The flood of activity in the first half of the year, with a high of 71 petitions filed in March, gave way to a summer lull, with eight petitions filed in August.

Starbucks is facing more than 325 unfair labor practice charges

Organizers blame the slowdown in their momentum on what they call Starbucks' "scorched-earth" campaign to crush the union.

Under its legendary CEO Howard Schultz, who returned to lead Starbucks in April, the company has taken a wide array of measures to aggressively fight the union — from blanketing employee communications with anti-union messaging, including in one-on-one meetings, to announcing raises and benefits for nonunion stores only, to firing workers identified as union leaders.

Starbucks has forged ahead with these actions despite being charged with violating the federal labor law that protects workers' rights to organize. The National Labor Relations Board (NLRB) is tasked with investigating the more than 325 unfair labor practice charges brought by the union.

So far, NLRB regional offices around the country have issued 35 formal complaints against Starbucks, citing the company for coercing, threatening and firing employees over their union activities and withholding wage increases and benefits from unionizing stores.

Starbucks denies any wrongdoing.

"We respect our partners' right to organize but believe the best future is created directly with partners and not a third party," company spokesman Reggie Borges said in a statement.

Union organizers say that the company's tactics are working: Starbucks' sustained campaign has had its intended chilling effect.

Added benefits for nonunion stores have led newcomers to question the union

Starbucks has one clear and consistent message: Employees don't need a union because the company has always provided for them — with competitive wages, health care, free college tuition and other benefits.

To prove the point, back in May, Schultz announced raises and a slate of new benefits for Starbucks employees, including faster sick time accrual, expanded training opportunities and credit card tipping.

(Many baristas cite tipping as a central issue in their demands, because unlike at many cafes and dine-out restaurants, credit card machines at Starbucks do not allow or prompt customers to add tips.)

But there was a catch. Schultz said the newly announced raises and benefits would apply only to nonunion stores.

"We do not have the same freedom to make these improvements at locations that have a union or where union organizing is underway," Schultz told shareholders at the time.

Almost immediately, Workers United filed an unfair labor practice charge against Starbucks, accusing the company of misleading employees and violating labor law by threatening benefits amid a union campaign.

But those complaints and others have done nothing to deter Starbucks. Since then, Starbucks has unveiled even more benefits — including financial tools aimed at helping employees build savings and manage student loan debt — again, for nonunion stores only.

The company has posted flyers about these new benefits in back rooms of stores, including unionized ones. What should be good news for workers has muddied the union's messaging and its efforts to expand to more stores. It's led new workers at unionized stores to question the point of a union.

"They kind of get a little angry because they're like, 'Well, how come we're not getting these benefits?'" says Gailyn Berg, who works at a unionized Starbucks in Falls Church, Va.

Berg, a shift supervisor who uses the pronoun "they," transferred to the Falls Church store after spearheading a failed union drive at another Starbucks location 10 miles away. Since then, turnover at the new store has been high. A lot of the original union supporters left for college or other jobs soon after the election. They've been replaced by newcomers who don't know much, if anything, about the organizing effort.

"So we really have to start from the beginning," Berg says.

Disheartened, Berg has backed away from the "gung-ho — gotta unionize them all!" attitude they'd embraced earlier in the year. But they haven't abandoned the fight.

Berg is now more distrustful of Starbucks than ever before. They believe the raises and benefits that Starbucks is giving nonunion stores could be taken away at a moment's notice. They're fighting not only to get everything that's been granted to nonunion stores, but to have all of it written into a union contract.

"There's definitely some security in having that union," says Berg. "It's like insurance."

Even at unionized stores, fear of retaliation is prevalent

Meanwhile, those still pushing for a union at Starbucks say they remain fearful that they could lose their jobs at any time.

"We're scared. We're terrified," says Jasmine Leli, a barista and union leader in Buffalo, N.Y. "We just want to go to work like everybody else and do our jobs and not have to worry [about] when the other shoe is going to drop."

She has good reason to be worried. Workers United says Starbucks has fired more than 100 union leaders. Federal labor officials investigating the dismissals have concluded that some employees were indeed wrongfully terminated, including seven in Memphis.

A federal judge in western Tennessee ordered the company to reinstate the seven workers. Starbucks said it disagreed with the judge's ruling, maintaining that those fired had violated company policies.

Penalties for violating federal labor law are weak

Beyond issuing complaints, the NLRB has little power to change the company's behavior. Congress prohibits the NLRB from assessing monetary penalties for unfair labor practices. Starbucks faces no fines, only "make whole" remedies such as back pay for reinstated workers and compensation for medical, legal and moving costs associated with firings.

"The penalties for breaking the National Labor Relations Act are quite weak, and that's a huge problem because it doesn't really serve as a deterrent," says Rebecca Givan, associate professor of labor studies at Rutgers University. "Employers decide that it's just worth it to break the law because the consequences are fairly mild."

Amid the union fight, coffee sales have risen

At the store level, union supporters have concluded that Starbucks just doesn't care about labor laws.

"I don't really think it matters to them," says Leli.

For Berg, it's more personal.

"They don't seem to really care about us at all," Berg says. "Howard Schultz, in particular, seems very busy trying to just continue on doing his thing, and not not really acknowledging the fact that he has lost faith of so many of us that really believed in him."

Indeed, Schultz continues to be very good at the very thing that Starbucks is known for: selling coffee. All the negative publicity surrounding the company's anti-union activity doesn't appear to have hurt its sales.

Starbucks' revenue rose in the third quarter of this year, exceeding expectations. Customer loyalty — measured through the growing number of Starbucks rewards members — remains strong. In August, the company projected net new U.S. store growth of 3% to 4% annually over the next few years.

Schultz seems satisfied with all this progress and is preparing to exit the company once again. Starbucks announced that his successor Laxman Narasimhan, who officially joined the company Oct. 1, will take over as CEO next spring.

The workers will soon get their chance to collectively bargain for a contract

After growing criticism from the union, which alleged delay tactics, Starbucks last week said it had sent letters to 234 unionized stores, offering three-week windows in October for members of the bargaining teams to come to the table. To date, only three Starbucks stores have begun contract negotiations, and no store is close to settling on a contract.

"We look forward to these negotiations and hopefully setting dates and securing locations for contract bargaining," Starbucks said in a statement.

The union, too, says it's ready.

A national bargaining committee made up of about 50 Starbucks employees is meeting weekly, mapping out strategies ahead of the talks. They've begun unveiling a set of noneconomic proposals addressing topics such as health and safety and nondiscrimination in the workplace.

"We've been planning for months," says Leli, who sits on the committee and has worked to gather input from thousands of employees around the country. "We want to make sure everyone feels seen and heard."

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