Starbucks will pay about $35 million to more than 15,000 workers in what officials are calling the largest worker protection settlement in New York City history — after the company allegedly denied thousands of workers stable schedules and cut their hours arbitrarily.
The agreement, announced Monday, could mean thousands of dollars for many Starbucks employees, with checks coming in the mail this winter. It calls for most hourly workers employed by the company in New York City from July 2021 through early July 2024 to get $50 for each week worked. An employee who worked for a year and a half during that period would get $3,900, according to a city announcement.
“These are individuals who are trying to have some regularity in their lives. They need to be treated with dignity,” city Department of Consumer and Worker Protection Vilda Vera Mayuga told Gothamist.
The department began looking into dozens of complaints against Starbucks locations in 2022, eventually expanding its investigation to the hundreds of stores throughout the city. Mayuga said investigators documented more than half a million alleged violations of the city’s Fair Workweek Law, which requires retail and fast-food companies to give employees predictable schedules and advance notice of changes.
The department found most Starbucks employees never got regular schedules and the company routinely reduced employees' hours by 15% or more, making it difficult for them to count on their income. The company also routinely denied workers the chance to pick up extra shifts, leaving them involuntarily in part-time status, according to the department.
Kai Fritz, a Starbucks barista at a location in Bensonhurst who previously worked in an East Village store, said it had been hard to tell which issues were systemic, and which were just common to the stores where they worked.
“It was pretty expected that the rules would change on you a lot, and that it would be hard to find out what exactly was the right way to do things legally, or Starbucks policy-wise,” said Fritz, a member of Starbucks Workers United.
But Fritz said the unpredictability made it difficult for employees to make rent, pay tuition or care for their families.
“ I saw many people get second jobs. I remember how exhausted my coworkers looked to work second jobs — like the physical pain that you're in all the time when you're on your feet all the time,” they said.
The settlement also guarantees employees laid off during the dozens of recent store closures the opportunity for reinstatement at other locations. Mayuga said her department is “very much paying attention” to reports of people being denied transfers as stores are shut down.
“ This goes to show you that workers can come, they can speak up, they can bring what they believe to be violations to our attention, and we will look at these violations,” she said.
The Fair Workweek Law requires that employers give 14 days notice for schedules, premium pay for schedule changes, the right to decline additional work time and the chance to work newly created shifts before workers are hired to fill them.
Starbucks Workers United — which represents 17 stores in the five boroughs, as well as several others in New York and on Long Island — escalated its ongoing “Red Cup Rebellion” workers strike on Black Friday, demanding better hours and pay, and restitution for what it alleges are union-busting tactics by the company. According to the union, 2,500 baristas from more than 120 stores nationwide were taking part in the open-ended strike, however the company has said disruptions to stores are minimal.
The union's president, Lynne Fox, said the money being awarded to workers will help them make ends meet this winter. She called it a "major victory for thousands of Starbucks baristas across New York City." The union also said it plans to continue to monitor for any continuing violations.
Starbucks, in a statement posted to its website Monday, described the settlement payments as "about compliance, not unpaid wages." The company said it's committed to complying with the Fair Workweek Law, but added that the requirements are challenging to meet.
Starbucks said almost any adjustment to schedules could be considered a potential issue, including last-minute changes when a person calls out of a shift.
Fritz said they expect to stash their payment into savings, or use it toward a down payment on their next apartment.
“While working at Starbucks, it's almost impossible to save money. All my money goes towards rent and groceries, and then after that there's almost nothing left. So the idea of having something to go into savings, so that in emergencies I can have money, is honestly very exciting to me,” they said.
Correction: This post has been updated to correct the name of Starbucks Workers United, and to correct Kai Fritz's pronouns. This story has additionally been updated to reflect a statement from Starbucks.
