The final days of the holiday shopping season witnessed disruptions as a Starbucks barista strike led to the closure of approximately 170 cafes across the US, according to the company. This labor dispute significantly impacted service and potentially sales during a crucial period for the coffee giant.
While Starbucks maintains that 98% of its more than 10,000 company-operated stores remained open, the Starbucks Workers United union anticipates the number of affected locations to reach 300. The strike, strategically planned to coincide with the peak holiday rush, raises concerns about lost revenue from beverage sales and the typically high volume of gift card purchases.
Over 5,000 workers in major cities like Boston, New York, and Philadelphia participated in the walkout on Tuesday. The strike, which began on December 20th in Chicago, Los Angeles, and Seattle, gained momentum in the days leading up to Christmas Eve. Elected officials, including Pittsburgh Mayor Ed Gainey, have shown solidarity by joining picketing baristas.
The core issue fueling the strike is a breakdown in negotiations between the union and Starbucks leadership. The union alleges that the company’s proposed package lacked immediate pay raises for union members. This contention underscores the ongoing tension between Starbucks and its unionized workforce, which began organizing for better pay, working hours, and improved scheduling in December 2021.
Starbucks, however, countered that the union “prematurely ended” a bargaining session and urged the continuation of talks. The company emphasizes its commitment to enhancing the employee experience, highlighting that baristas working at least 20 hours per week earn an average of $30 per hour, inclusive of benefits.
Starbucks CEO Brian Niccol, appointed in September, has vowed to engage in good-faith negotiations with the union. Tasked with revitalizing declining sales, Niccol’s tenure has seen a 3% drop in Starbucks stock value since September 9th, contrasting with a 10% gain for the S&P 500 Index. This performance adds further pressure to resolve the labor dispute and stabilize the company’s standing. The union stated that baristas plan to return to work on Wednesday or Thursday and are prepared to resume negotiations. The outcome of these discussions will significantly impact Starbucks’ operations and labor relations moving forward.
