Starbucks CEO Howard Schultz Violates Labor Law, NLRB Rules

 

By Ramishah Maruf, CNN

In a significant ruling, the National Labor Relations Board (NLRB) declared that Howard Schultz, the interim CEO of Starbucks, violated federal labor law by making an unlawful statement to a barista concerning unionization efforts. During a company event in Long Beach, California, Schultz told barista Madison Hall, “if you’re not happy at Starbucks, you can go work for another company,” when she attempted to discuss the benefits of unionizing and raised concerns about the company’s labor practices.

The NLRB's decision, released Wednesday, underscores the contentious relationship between Starbucks and organized labor as more employees have sought to unionize across the coffee chain. Schultz's comment, described in the ruling as a coercive threat, was made while he appeared visibly angry, according to the administrative law decision. The NLRB upheld an earlier ruling from October 2023, which indicated that Schultz's remarks represented a direct attempt to intimidate employees involved in unionization.

In response to the NLRB’s findings, Starbucks issued a statement expressing its disagreement with the ruling. “Our focus continues to be on training and supporting our managers to ensure respect of our partners’ rights to organize and continuing to make progress in our discussions with Workers United,” a company spokesperson said.

This incident occurred in the context of a broader trend at Starbucks, where employees have increasingly sought to unionize. Since the first unionized store opened in Buffalo, New York, in 2021, the company has faced numerous labor disputes, with allegations of union-busting tactics. One notable case, Starbucks v. McKinney, reached the Supreme Court, which ruled in favor of Starbucks regarding the dismissal of seven employees involved in union efforts.

An NLRB administrative law judge previously characterized Starbucks’ conduct in Buffalo as exhibiting “egregious and widespread misconduct.” The judge noted that high-level executives were sent into stores to deter union support, which likely influenced employees' voting behaviors against union representation.

Despite Schultz stepping down as CEO in March 2023 after his third tenure, he remains associated with the company as “lifelong chairman emeritus” after retiring from the board of directors. The NLRB’s ruling also indicated that Schultz's status as a “legendary leader” heightened the coercive nature of his comments.

On October 1, the 500th Starbucks location voted to unionize in Washington state, marking a milestone in the ongoing movement among Starbucks workers. The NLRB has ordered the company to cease and desist from threatening employees involved in union activities and to post notices of employee rights at all its Long Beach stores.

Michelle Eisen, co-chair of Starbucks Workers United’s national organizing committee, welcomed the NLRB’s support for workers’ rights. “We’re happy to see the NLRB continue to stand up for workers and our legal right to organize. At the same time, we’re focused on the future and are proud to be charting a new path with the company,” she said in a statement.

For ongoing updates on this developing story and other labor-related news, follow me on Twitter: @dark_web24.