Why Starbucks Is Being Accused Of Holding Back On Union Benefits

Starbucks Workers United has told CEO Howard Schultz that if he were to extend the pay raise and expansion of benefits offered to non-union workers to union ones, they would agree to it. This is the latest turn in a story that began in April, when CNBC announced that Starbucks was considering giving better pay and benefits to stores that have not voted to unionize. Schulz explained that American labor laws prevent Starbucks from unilaterally granting benefits to unionized locations.

It should be noted, however, that this is not strictly speaking true. The Wall Street Journal learned from Cathy Creighton, director of the Cornell University ILR Buffalo Co-Lab and a former attorney of the National Labor Relations Board (NLRB), that Schultz is correct in that he cannot enact a unilateral change. However, he is allowed to offer them additional benefits. Creighton went on to describe Schultz's offer to raise wages and expand benefits as a "a union avoidance technique." In other words, the idea is that by giving better pay to non-union workers, those workers might not think that a union is necessary to improve their working conditions. Of course, critics would raise the point that only the threat of a union brought about such considerations. 

Part of Starbucks Workers United's statement was directed towards questioning the motive of Howard Schultz. In a letter quoted by CNBC, Lynne Fox, president of Workers United, told Schultz that "Workers United refuses to stand by while Starbucks cynically promises new benefits only to non-unionized workers and withholds them from our members." The cynical aspect is that during a wave of unionization, some workers may see the better pay as an incentive to vote against unionization.

Starbucks Workers United informed Restaurant Dive that the company has not responded to the letter. However, a Starbucks spokesperson claimed the company will bargain over benefits, saying, "We are going to follow the law established by the NLRB, which means when a group is unionized, new benefits are not allowed without good-faith bargaining." So, some Starbucks cafes in New England have been hosting strikes from 9 a.m. till noon daily, joining one that already begun in Boston. 

The withholding of raises and benefits may backfire, inspiring more outspoken union activity instead of reducing it.