Starbucks CEO Howard Schultz spars with Bernie Sanders over anti-union campaign as workers demand a contract

Bernie Sanders grilled the billionaire chief of the coffee empire, which has still yet to recognise a single union contract after headline-making elections – and a mountain of labour law violations

The billionaire CEO of one of the world’s largest retail coffee chains faced off against union advocate Bernie Sanders and a panel of US lawmakers, following mounting allegations of a months-long union-busting campaign that has seen stores shutter, workers fired, and not a single union contract recognised.

After workers at Starbucks stores in New York launched the first of dozens of campaigns to unionise workers at the retail coffee giant, the company has been hit with hundreds of complaints alleging an aggressive, retaliatory anti-union effort that one judge has called “a general disregard for the employees’ fundamental rights” to form a union.

At his appearance before the US Senate’s labour committee on 29 March, Starbucks CEO Howard Schultz repeatedly denied that the company has violated federal labour law, weeks after an administrative judge added to the pile of allegations against the company with a ruling that determined the company violated federal labour laws “hundreds” of times.

“Starbucks coffee company, unequivocally – and let me set the tone for this very early on – has not broken the law,” Mr Schultz told the panel, drawing some laughter from the gallery.

“We want to treat everyone with respect and dignity,” he added. “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.”

His appearance at the committee nearly didn’t happen. Senator Sanders was preparing to hold a vote to subpoena Mr Schultz to testify to the committee, but Mr Schultz agreed to voluntarily appear.

He then abruptly announced that he would be stepping down from his role at the company roughly two weeks before his planned departure.

Workers describe ‘concerted efforts’ to undermine unions

After a successful union election in Buffalo, New York, Starbucks workers have voted to form a union in roughly 280 other stores, roughly 3 per cent of the chain’s US locations, part of a wave of renewed labour actions that invigorated a militant labour movement following the compounded crises of the Covid-19 pandemic, its economic fallout and growing wealth disparities among the nation’s top executives and lower-wage workers.

Maggie Carter, a former Starbucks worker and mother to an eight-year-old son, testified to the committee that she was terminated from the company following union organising efforts at her store in Tennessee. There was a “concerted effort” to penalise workers “who showed the smallest bit of support for the union,” including closing stores to hold so-called captive audience meetings to discourage workers from organising, she said.

Jaysin Saxton, a Coast Gaurd veteran and former Starbucks shift supervisor, told the committee that the company ramped up its anti-union campaign after his store successfully voted to unionise last year. He said he was terminated without any write up, disciplinary action or investigation, and has filed a charge with the federal labour board.

Salwa Mogaddedi, a Starbucks worker at a Connecticut location that became the state’s second store to vote to unionise, joined workers who criticised Starbucks’ “drawn-out” negotiations that have led to unfair treatment and forced turnovers following initial optimism fuelling the union campaign in Buffalo.

“I think that’s where a lot of people were when this first started, until we saw the treatment of Buffalo and the initial union campaign, and then realised, ‘Well, they’re not going to bargain in good faith, they’re going to initiate smear campaigns, they’re going to call people who are collectively [bargaining] ‘nefarious,’” she told The Independent.

“You’re losing people, there’s unfair firings … and there’s simply people who are so pressured, who feel like they’re being marginalised and targeted, so they want to leave, they don’t want to stick it out,” she added. “They got to put food on the table. A lot of these people have kids, a lot of these people can’t afford to wait for Starbucks to suddenly become the good guys.”

Union organisers allege more than 1,400 violations. Howard Schultz is at the centre of dozens

The National Labor Relations Board has filed more than 80 complaints against Starbucks for violating federal labour law following 500 unfair labor practice charges lodged against this company, according to a report compiled by the Senate committee’s staff.

NLRB judges have found that Starbucks broke the law 130 times across six states, including firing or forcing out 12 pro-union workers and firing another two workers because they cooperated with NLRB investigations, the report found.

The NLRB is also currently taking Starbucks to trial in 70 additional cases, according to the report.

Starbucks Workers United has alleged more than 1,400 individual violations of federal labor law, and administrative judges have determined that the company violated labour laws in at least eight cases, including allegations that Starbucks illegally monitored and fired union organisers, called the police on workers, and closed stores where workers have organised.

Mr Schultz himself has been at the centre of roughly 100 charges over statements he made during meetings with union members, according to Mr Sanders’ office. Mr Schultz has also been accused of threatening a worker who supported a union, according to union allegations.

The committee’s report also determined that Mr Schultz “is, and has always been, the architect of Starbucks’ anti-union campaign,” which he denied under questioning from Mr Sanders.

“My involvement, my engagement and my return to Starbucks has been primarily involved with operation of our business,” said Mr Schultz, adding that his involvement with union effort has been “de minimis.”

Mr Schultz did not explicitly deny whether he ever “threatened, coerced or intimidated” a worker who supported union efforts, following questioning from Mr Sanders.

“I’ve had conversations that could have been interpreted in a different way than I intended,” he said. “That’s up to the person who received the information that I spoke to them about.”

He also did not deny that Starbucks withheld new benefits from workers in union stores, following the NLRB allegations that the company illegally withheld raised wages and benefits from thousands of unionised baristas.

“My understanding was, under the law, we did not have the unilateral right to provide those benefits to employees who were interested in joining a union,” he told the committee.

Democratic Senator Tina Smith pointed out that the union “specifically” waived any objections to Starbucks providing wage or benefit improvements.

“I just think you’re wrong,” she told Mr Schultz.

“You think Starbucks doesn’t need a union because you’re a good company, but I think, Mr Schultz, that’s not your decision to make,” she said. “I mean, you’re a billionaire. And they’re your employees. The imbalance of power is extreme, and that is why people want to come together to form a union.”

Bernie Sanders demands Starbucks to bargain in good faith

Senator Sanders pressed Mr Schultz on whether he will agree to exchange proposals with the union within 14 days after the hearing, following dozens of meetings between union organisers and Starbucks representatives that failed to yield a single contract.

“Do it,” Mr Sanders said in his closing remarks. “Tell us the success you’ve had in finally negotiating a first contract.”

Senator Bill Cassidy, the committee’s ranking Republican, told The Independent that while he does not necessarily oppose the formation of a union among Starbucks workers, he does not plan to meet with Starbucks workers who have flooded Capitol Hill this week to meet with lawmakers.

“The purpose of the meeting, I presume, would be to hear their concerns, or concerns have been very well laid out,” he told The Independent. “And we need a process to see if this is just the way the law works.”

Congressional Republicans suggested that officials at the NLRB are launching politically motivated investigations and judgments against Starbucks as Democratic lawmakers and President Joe Biden seek to bolster union protections.

On 24 March, the NLRB rejected a subpoena request from a Republican-led House panel seeking documents from an agency staff member, stating that such an “unprecedented action” threatens to interfere with its cases, compromises integrity and violates due process for parties involved with the agency’s work.

GOP lawmakers suggested that the agency has worked with Starbucks Workers United to win elections by manipulating the voting process.

Starbucks worker Jordi Adams told The Independent that if that were true, “we would have a 100 per cent success rate, and we don’t.”

“We’re still holding fair elections,” she added. “And sometimes the union busting is so bad that a store changes their mind and votes to not unionize for pure fear of corporate retaliation.”