Howard Schultz Denies Union-Busting In The Face Of 'Unprecedented' Allegations
Recently retired interim CEO of Starbucks Howard Shultz testified before the Senate Health, Education, Labor, and Pensions Committee (HELP) on Wednesday, answering to allegations of his participation in labor laws violations by the company against employees attempting to unionize. Schultz rejoined Starbucks in 2022 after a failed second attempt at retiring. He remains on Starbucks' board of directors and has spent the past year of his tenure defending the company's labor practices.
Independent Senator from Vermont Bernie Sanders, a perpetual defender of blue-collar workers' rights, chairs the HELP committee and faced off against Schultz, saying, "Over the past 18 months, Starbucks has waged the most aggressive and illegal union-busting campaign in the modern history of our country. The fundamental issue we are facing today is whether we have a system of justice that applies to all — or whether billionaires and large corporations can break the law with impunity" (via NPR). While democratic Senators joined the barrage against Schultz, he found an ally in the Republicans, with Senator Rand Paul praising Schultz for getting people to pay as much for a "double mocha latte as they once did for a week's worth of coffee" (per U.S. Senate).
A founding member of Starbucks, Schultz, was once hailed as a champion for employees' rights and now stands to be remembered as a union-buster. The former CEO denied all misconduct charges and appeared offended as the panel repeatedly labeled him a "billionaire," using his "federally subsidized" upbringing as a defense.
No company is above the law
The union, Starbucks Workers United, filed hundreds of complaints against the company, stating they crossed the line and blocked unionization using intimidation practices, firings, and in a few cases, closing an entire unionized store. To date, Starbucks Workers United has won eight lawsuits, although the company is appealing the rulings. In those cases, Starbucks' employees (the plaintiffs) have been granted their jobs back or "made whole" by the company.
Since 2021, the National Labor Relations Board (NLRB) has certified 300 votes to unionize Starbucks' stores nationwide, although the company has failed to begin negotiations for the first contract for over 460 days. However, Sen. Bernie Sanders scored a victory today, getting former CEO Howard Schultz to commit to exchanging contract proposals within 14 days of the hearing — shaving a year off of the previous timeline.
To a snickering courtroom, Schultz admitted his misgivings about unionizing and testified, saying, "We want to treat everyone with respect and dignity. However, I have the right, and the company has the right, to have a preference. And our preference is to maintain the direct relationship we've had with our employees, who we call partners." Schultz was replaced by Laxman Narasimhan as CEO, who spoke at a shareholders meeting last week, giving no indication that Starbucks was changing course. This is clearly not the end of this story.