Economy

Starbucks Faces New Pressure Over Union Campaign

More than two years into a campaign that has unionized more than 350 Starbucks stores, the company is facing mounting pressure from union officials and activists who say it has illegally retaliated against workers and resisted contract negotiations.

Starbucks, which denies violating labor laws, has responded with mixed signals about its willingness to engage with the union. The company announced early last month that it was seeking to restart negotiations at unionized stores, only one of which has held bargaining sessions over the past six months. Yet the company continues to resist a union demand that some workers be allowed to take part in bargaining sessions remotely to enable more to participate.

Starbucks has taken steps to address workers’ complaints about being overstretched in stores. But it and the union have sued each other in a dispute arising from social media postings about the war in Gaza.

A report on Starbucks’ labor practices, prompted by a shareholder vote and released last month, criticized the company for falling short on commitments it made to respect union activity, though it found “no evidence of an ‘anti-union playbook.’”

“There are green shoots of promising behavior right now,” said Jonas Kron, chief advocacy officer of Trillium Asset Management, which makes investments to further environmental, social and governance goals and had a roughly $31 million stake in Starbucks as of September. But, he added, there is also “ongoing concerning behavior.”

The persistence of the organizing effort is one source of pressure on the company. The union campaign flagged in the second half of 2022, as election filings dropped to about 12 a month on average from more than 50 a month in the first half of the year. The monthly filings ticked up last year and averaged roughly 20 from October to December.

Other challenges are more recent. In late November, a coalition of unions that includes the parent of Workers United, which represents Starbucks workers, nominated three candidates for seats on the company’s board.

The coalition, known as the Strategic Organizing Center, is an investor in the company and cited “potentially irreversible damage” to Starbucks’ brand resulting from anti-union actions. It noted that the National Labor Relations Board had issued dozens of complaints against the company tied to hundreds of accusations of illegal behavior, including a failure to bargain in good faith.

Starbucks denies the accusations, noting that it has proposed more than 500 bargaining sessions with the union, and the cases are still being litigated. The company has said it will review the proposed board nominees and is “committed to constructive dialogue.”

Experts in board fights said the campaign appeared serious. All three candidates were senior government officials, largely under Democratic presidents, and the coalition has retained prominent firms to aid in the fight.

“This is not a publicity stunt, I think,” said Kai Liekefett, a partner at Sidley Austin who specializes in defending boards against shareholder campaigns. “They’ve hired very sophisticated advisers.”

Mr. Liekefett said a vote at Starbucks’ last shareholder meeting, in which investors backed a resolution that prompted the company to commission the assessment of its respect for labor rights, suggested that investors could be open to a board challenge tied to labor issues.

At the same time, grass-roots actions by union supporters have sought to exact a price on board members and the company over its posture toward unions.

Students at Georgetown University, Boston University and the University of California, Los Angeles, have waged campaigns to remove Starbucks stores from their campuses. Union supporters interrupted a forum at U.C.L.A. featuring Andrew Campion, a Starbucks board member, to heckle him for “condoning the injustices that Starbucks workers face.”

After a plea from union members in November, a nonprofit group rescinded an award naming Mellody Hobson, the Starbucks chairwoman, one of its “25 Mentors of the Year.”

The nonprofit group, Step Up, which focuses on mentoring teenage girls and young women, said that Ms. Hobson’s accomplishments identified her as a strong mentor but that “the union’s outreach letter to Step Up shed a light on other concerns.” Ms. Hobson declined to comment. Starbucks declined to comment on the campus campaigns and the targeting of board members.

Mellody Hobson, the Starbucks chairwoman, during a Senate committee hearing about the company’s labor practices on Capitol Hill in March.Credit…Kenny Holston/The New York Times

Starbucks recently announced a change that union members had long pressed for: making it easier for workers to temporarily block orders placed through mobile phones when they face operational challenges, like understaffing. The union elevated the issue during a recent strike at dozens of stores.

The company told workers two weeks after the strike that shift supervisors, who are union members, and managers would soon be able to pause mobile orders using an iPad app. Starbucks said that it hadn’t altered its policy on pausing mobile orders, a significant source of revenue, and that shift supervisors continued to need manager approval to do so. The company said that it was simply adding technology to help stores pause orders more efficiently, and that the change had been in the works for months.

At other times, the company has been more confrontational toward the union. Shortly after the Oct. 7 attack by Hamas on Israel, the union’s official account on X featured a message expressing “Solidarity with Palestine!” above a photo that appeared to show a bulldozer that had forced open a fence between Israel and Gaza.

Starbucks criticized the union for “advocating for violence in the Middle East” and later sued the union for trademark infringement, arguing that union statements harmed Starbucks because many people confuse the union with the company. The company said the lawsuit was prompted by a desire to ensure the safety of its employees, who were threatened by angry members of the public.

The union sued for defamation, saying that the “solidarity” post was unauthorized, that it had been quickly deleted and that no reasonable person could conclude from it that the union supported terrorism.

Laxman Narasimhan, who became chief executive in March, has yet to chart a clear course on union matters, although he is more inclined to be conciliatory than his predecessor, Howard Schultz, according to two former Starbucks corporate employees familiar with the men’s thinking. Mr. Schultz appeared to regard the union as a personal affront, the former employees said, and worked to defuse support for it.

Starbucks declined to comment on any differences in approach between the current and former chief executives. Mr. Schultz, who left the Starbucks board in September, did not respond to a request for comment on the matter.

In recent weeks, Mr. Narasimhan appears to have wearied of the controversies that followed the union’s post and the company’s lawsuit, as groups and activists sympathetic to Israelis and Palestinians alike have announced boycotts of Starbucks.

In a letter to employees dated Dec. 19, the chief executive expressed concern about “escalating protests” tied to global conflicts and noted that many stores had suffered acts of vandalism.

“We see protesters influenced by misrepresentation on social media of what we stand for,” he said, adding: “Our stance is clear. We stand for humanity.”

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