Starbucks to Pay $35 Million After New York City Rules the Company Violated Scheduling Laws
After detectives found that Starbucks violated local scheduling laws, the global coffee chain has consented to pay about $35 million to more than 15,000 of its employees in New York City. The city officials, in their turn, maintain that the company refused to provide employees with stable and predictable hours and, on the contrary, it was cutting their schedules arbitrarily, a practice which is contrary to the city’s “Fair Workweek” law.
Besides the $35 million payout, Starbucks will also be liable for a civil penalty with a total amount of $3.4 million. Furthermore, the agreement enables previously laid-off staff members to avail themselves of the opportunity to be rehired at other branches.
The settlement is a result of a comprehensive investigation initiated by the city in 2022 because of numerous grievances made by Starbucks employees about the inconsistency of their schedules and few possibilities of working extra hours. The investigation found that the noncompliance with the regulations was common in a large number of Starbucks branches across New York.
What is more, the resolution is accompanied by a strike of many baristas who are going on strike to demand better staffing, stable hours, and improved working conditions in general. Last month the baristas started their strike, organizing and coordinating their efforts through Starbucks Workers United. Many prominent political figures, e.g. New York’s Mayor-elect or a U.S. Senator who was alongside workers on the picket lines, have expressed their support of the strike.
In accordance with the agreement, those hourly workers who qualify will be granted a sum of $50 for every week they worked between July 2021 and July 2024. In addition, they may have the right to further compensation should they submit a complaint under the accord. Also, Starbucks has ensured compliance with the Fair Workweek law from now on.
The agreement is a large one as far as worker-protection payouts in New York City are concerned. To employees and labour organizers, it means a rare win and acknowledgment that steady scheduling and fair labor practices are important. The verdict, however, can also be taken as a warning to other big employers that their labor practices will be under close surveillance and they will have to comply with local labor laws.
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