On Friday, members of Starbucks Workers United held their first strike in 13 months and announced plans to escalate protests with progressive work stoppages leading up to Christmas Eve. If carried out, this action would become the largest strike organized by the union.
Why is there a strike at Starbucks?
The union claims that Starbucks has reversed the progress made since September, coinciding with the arrival of Brian Niccol as the new CEO.
According to union representatives, in October, November, and December, the company failed to present meaningful economic proposals that included a true investment in baristas. This marks a setback after months of progress and company commitments to reach an agreement on the labor framework by the end of the year.
The union also criticized the high compensation of executives, highlighting the package given to Brian Niccol as evidence that Starbucks has the ability to do more.
Niccol, who took office in September, received 332,000 shares of Starbucks as part of his contract, to be awarded over the next three years. As of Thursday’s close, those shares were worth $29.5 million.
“Starbucks has broken its promise to thousands of baristas and left us with no choice,” said Fatemeh Alhadjaboodi, a Starbucks barista from Texas, in a statement released by the union.
The spokesperson pointed out that, despite Starbucks spending millions of dollars this year to hire and compensate high-level executive talent, the company has not presented a meaningful economic proposal for the baristas, who are the backbone of the company.
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In response, Starbucks asserts that it is committed to reaching an agreement and expresses its willingness to return to the negotiating table. However, the company maintains that it is the union that has interrupted the dialogue.
What does Starbucks say about the strike?
In a statement, the company expressed disappointment that the union has not returned to the negotiating table, given the progress made so far.
It noted that, since April, the company has held over nine negotiation sessions spanning 20 days.
“We have reached more than thirty significant agreements on hundreds of issues that the Workers United delegates told us were important to them, including many economic matters,” the statement reads.
The company stated that it offers an average hourly wage of over $18 and provides what it considers industry-leading benefits, including healthcare, free tuition, paid family leave, and company stock options.
“No other retailer offers this type of comprehensive compensation and benefits package,” it said.
Where is the Starbucks strike happening?
The strike is scheduled in three U.S. cities:
- Seattle
- Chicago
- Los Angeles
The strike is expected to spread to hundreds of stores nationwide before Christmas Eve unless the company agrees to establish a framework to finalize the first union contract in its history.
What is a company strike?
A strike is a temporary work stoppage organized by employees as a form of pressure on the employer, with the goal of improving working conditions.
The Impact of Strikes on Starbucks
The strike, which the union claims will affect an increasing number of stores each day until Tuesday, comes at a critical time for Starbucks, which is facing stagnating sales in its key markets.
Starbucks’ sales dropped in 2024. In the last quarter, the company’s revenue fell by more than 3% year-over-year, reaching $9 billion. Comparable store sales dropped 7% globally, while its net profit fell to $909 million, a decline of over 25%.
