This month, Starbucks requested to reopen contract negotiations with Workers United after a 6-month impasse. The company further expressed intent to reach contracts with all unionized stores in 2024. That’s quite a leap since none of the 380+ unionized cafes have a contract yet.
This notably softened stance towards Workers United follows a labor-relations audit finding that no “anti-union playbook” existed for Starbucks, even if corporate and management’s response to unionizing wasn’t handled in the most graceful way (ex-CEO Howard Schultz was decidedly combative towards Workers United during Senate testimony). The audit also called upon the company to revise its Global Human Rights Statement. And Starbucks is not only coping with reputational harm while addressing shareholder concerns, but the headaches continue:
The latest NLRB chess move: The board is pressing Starbucks to reopen 23 shuttered locations while accusing the company of illegally closing them to quash union activity. It’s a charge that the company denies while citing reasons including increased violence in some cafes and that certain locations were not profitable. However, Workers United claimed that they should have been notified in advance of the closings and allowed to bargain over the decision to close stores.
The board also wants workers to be rehired and compensated for lost wages following the closings, which included eight cafes in Seattle, where the company is headquartered. The case will go to an administrative judge and then possibly back to the NLRB and onto a federal appeals court if it reaches that level.
Other recent NLRB moves against Starbucks: The company has been fending off GC Jennifer Abruzzo’s 10(j) injunction efforts. Federal judges have also validated a mail-ballot union election and ruled that the company cannot bar workers from wearing union paraphernalia on the job.
Still more PR woes: Not only have baristas continued to wage walkouts, including the recent Red Cup Rebellion strike, but Starbucks was placed in an uncomfortable position when Workers United began using the company logo to wade into the Israeli-Palestinian conflict. The resulting political firestorm has led to calls for boycotts along with vandalism of cafes near Houston, San Francisco, and Boston. This adds up to a dearth of holiday cheer reverberating throughout the company.
This week, CEO Laxman Narasimhan marked his first anniversary with a letter to workers. In doing so, he characterized the vandalism and protests as being “influenced by misrepresentation on social media” about what Starbucks stands for. He also stressed the need to protect workers’ safety in light of these incidents.
It’s an unenviable position and only the latest obstacle for Narasimhan in steadying the ship after baristas expressed how they felt that Schultz glossed over their reasons for seeking third-party representation. Since entering his position, Narasimhan has pledged open communication and has worked regular barista shifts next to frontline workers.
Whether or not the company’s decision to reopen contract negotiations will help ease ongoing worker dissent remains to be seen. Surely, Starbucks and its shareholders would prefer not to have to address this mess at all, and it’s a reminder that accessible leadership can solve grievances more smoothly in a proactive way rather than in front of a worldwide audience.