A Brilliant Strategy of Playing Hard to Get! Howard Schultz's Management of Starbucks is Truly Impressive!

On April 5th, Starbucks' current interim CEO Howard Schultz announced on his first day back that he was suspending the multi-billion dollar stock repurchase plan, while stating that this move would help the company invest more money in employees and stores. Simply put, Howard Schultz was preparing to use the money that would have been used for stock repurchases to increase benefits for current employees and operational funds for stores.

When this news came out, partners who had recently established the Starbucks employees' union in the United States felt they had seen "hope"! They believed that because of the union they had established, they had "forced" Starbucks to make this decision. Consequently, in the days following the announcement, more and more American Starbucks employees voted and joined existing unions.

Before Howard Schultz's return, he had already spoken with the person in charge of the first Starbucks store to establish a union. At that time, Howard Schultz also told New York Times reporters that the company had failed to help them solve operational problems in their stores, which had disappointed them. This statement further convinced union members that Howard Schultz's 2022 Starbucks plan would increase their benefits and address staffing shortages.

Yes, that's right, Howard Schultz genuinely intended to increase employee benefits, but! Partners who joined the union might not be able to enjoy these new benefits. Reason: The new policy legally cannot be extended to stores with unions or partners who have joined unions.

Legal Constraints on Benefit Distribution

On April 13th, Howard Schultz stated in an online meeting with store managers from across the United States that he was evaluating Starbucks' benefits system to expand the employee benefits program. This expanded benefits policy would help reduce the turnover rate of Starbucks employees and enable stores to better recruit and retain baristas.

However, these new benefits legally cannot be provided to stores that voted to establish unions or partners who have already joined unions, because according to federal law requirements, Starbucks cannot unilaterally change the compensation and benefits of union members or the operational funds of unionized stores. The company needs to separately negotiate with union representatives before making decisions.

Legal Expert Perspective

Regarding Howard Schultz's speech this time, an American labor law expert stated that Starbucks has the right to discuss the differences in benefits received by unionized and non-unionized partners, but cannot make related implications. Once implications about benefit differences are made, it's equivalent to attempting to provide worse benefits to union partners than non-union partners, which could constitute evidence of malicious bargaining and be considered an unfair labor practice. However, Howard Schultz's speech this time was merely explaining legal requirements, making it difficult to determine whether he had related implications.

Shift in Union Strategy

Although this meeting simply explained the relevant legal requirements and indicated that the company would formulate two new benefit policies according to legal requirements, compared to Starbucks' previous approach of forcefully preventing and stopping union formation before Howard Schultz's return, this approach was clearly much gentler...

If the hard approach doesn't work, then try the soft approach.

Image source: Internet

For more specialty coffee knowledge exchange and coffee bean information, please follow Coffee Workshop (WeChat public account: cafe_style)

For more specialty coffee beans, please add private WeChat FrontStreet Coffee, WeChat ID: kaixinguoguo0925

Important Notice :

前街咖啡 FrontStreet Coffee has moved to new addredd:

FrontStreet Coffee Address: 315,Donghua East Road,GuangZhou

Tel:020 38364473