Business

Starbucks employees at Buffalo Café vote to unionize, a first for a U.S. coffee shop.

After months of fighting, Starbucks workers in Buffalo, New York, supported efforts to unionize at least one local café.

The result marks the first successful attempt to unionize the offices of the American coffee giant since it went public nearly three decades ago, and could cause unrest in the restaurant industry.

Workers on Elmwood Avenue by 19 votes to eight to unionize under the auspices of Workers United New York, a branch of the International Union of Service Workers.

A second cafe, located on Camp Road, voted against the union: eight workers in favor and 12 against. One ballot was invalidated and two more were challenged by Starbucks or the union. The union also said that several submitted ballots were missing. The National Labor Relations Board is still counting votes for another Buffalo.

The company’s shares fell less than 1% after lunch on the news.

MKM Partners analyst Brett Levy wrote in a note to customers on Thursday that he doesn’t think today’s decision will have an immediate impact on Starbucks’ strategy or financial results. However, Levy said wider unionization at Starbucks could lead to another wage increase for workers in the future. Additionally, if employees of other restaurant chains follow suit, Levy wrote that Starbucks is one of the companies that has more room to cover higher costs.

Alliances in the restaurant industry are rare. According to the Bureau of Labor Statistics, in 2020, only 1.2% of food service workers were union members, below the level of unions in the private sector (6.3%). But a tight job market is spurring more organizational efforts. This year saw union protests by Amazon workers and strikes by employees of John Deere and Kellogg. But efforts have not always led to union victories.

The NLRB has sided with Starbucks Workers United twice, first allowing stores to vote as a whole, rather than opening all 20 stores in the region to vote as Starbucks wanted – a move that usually favors the employer. As a result, 81 workers received the right to vote instead of 450 throughout the city.

Then this week, the NLRB allowed the vote count to be rescheduled until Thursday afternoon. The ballots were mailed with a Wednesday night deadline and the vote count was broadcast via Zoom. The union struggle has caught the attention of legislators, including Senator Chuck Schumer, DN, Senator Bernie Sanders, Washington, and Rep. Alexandria Ocasio-Cortez, DN, who have expressed support for workers seeking unification.

Wages, the problem of staff shortage

Starbucks’ union efforts have met with strong opposition from management. The company sent executives and former CEO Howard Schultz to offices in Buffalo in what Starbucks Workers United called “union busting.” In November, workers filed federal labor charges, accusing Starbucks of illegal activities such as engaging in a campaign of threats, intimidation and surveillance in response to union pressure. The company denied the allegations.

“I certainly apologize if anyone thought it was intimidation. This is actually what I have been doing for 17 years, so whether it was something special for a partner or a situation, I cannot talk about every situation, ”said Rossann Williams. President of Starbucks North America. “I can say that our partners turned to us for help, and we came, and they were absolutely right. They let them down and we apologized for that. “

The coffee chain is known for calling its employees “partners” and touting the most progressive advantages in the fast food and restaurant business. But wages and working conditions were two sticking points for union workers, who said the pandemic had exacerbated labor shortages and put pressure on employees.

Starbucks told investors last quarter that Profit in fiscal 2022 will be lower than analysts predicted. The company blamed both the continuing impact of the Covid-19 pandemic and rising costs, including salaries.

In late October, Starbucks announced that it would raise workers’ wages based on market and tenure. By the summer of 2022, the minimum wage will be $ 15 an hour and the average hourly wage will be $ 17 an hour, up from the current average of $ 14. Starbucks shares have dropped 2.5% in the past three months, but are up less than 6% in the last month.

New battles ahead


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