The Business Times

Starbucks audit finds chain isn’t using ‘antiunion playbook’

Published Thu, Dec 14, 2023 · 12:29 AM

STARBUCKS, contending with unionisations at hundreds of its US stores, should bolster guidance on how it disciplines workers and measures compliance with collective bargaining rights, a third-party assessment of the company’s labour practices found.

The assessment – which shareholders requested in March against the company’s recommendation – found no evidence of an “antiunion playbook” suggesting “surreptitious means of interfering with employees’ freedom to choose.” It also ascribed “missteps” in how Starbucks has engaged with unionised workers mostly to the company’s lack of preparation for a wave of organising, and to mistakes by local staff with no experience dealing with unions.

Workers United, which represents the bulk of unionised stores, “prepared thoroughly for its organising efforts, had careful top-down leadership, and was effective at leveraging Starbucks’ early missteps to frame a ‘Starbucks is antiunion’ narrative,” according to the report prepared by Thomas Mackall, a consultant and former labour-relations executive.

Still, Starbucks could enhance its human-rights commitment, which includes a promise to respect labour organising, and create materials that more clearly outline just how its staff can comply.

Behavioural guidance

As written, the commitment “does not provide meaningful behavioural guidance or a clear basis for compliance regarding freedom of association and effective recognition of the right of collective bargaining,” according to the report.

The report also found that discharges at locations that have organised happen at the same rate as at nonunionised stores, but that Starbucks could bolster the framework and standards for staff discipline given the “special attention” that terminations at unionised cafes face.

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Starbucks can also give better training on how managers should communicate with unionised workers, after US labour prosecutors have found that “store-level managers or supervisors have stepped out of bounds in many instances,” according to the report.

“Even well-intentioned managers operating in a delicate environment can have difficulty navigating the nuanced boundaries between that which is lawful and appropriate and that which is not,” according to the report.

‘Meaningful action’

Starbucks’ board is “intent on taking meaningful action,” according to a letter to shareholders by chair Mellody Hobson and Jørgen Vig Knudstorp, who leads the nominating and corporate governance committee.

The two said that chief executive officer Laxman Narasimhan and his leadership team “have begun work against these findings to fully address opportunities identified.”

Starbucks released the assessment days after the Seattle-based company said it had reached out to the union representing hundreds of its stores in an attempt to end an impasse over contract talks.

Regional directors of the US National Labor Relations Board have issued over 100 complaints accusing Starbucks of illegal anti-union tactics, including closing stores, firing union leaders, and refusing to fairly negotiate at unionised cafes. Judges and NLRB members have ordered the company to reinstate 36 activists. Starbucks has denied wrongdoing, saying the union is the party refusing to negotiate in good faith.

A second union representing some Starbucks workers has also accused the company of failing to negotiate fairly, a charge that Starbucks contests.

The company’s shares fell 1 per cent at 10.10 am in New York. The stock had declined 1.1 per cent this year through Tuesday’s close, compared with a 21 per cent advance for the S&P 500 Index over that period. BLOOMBERG

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