07/24/2024: Starbucks Illegally Denied Raises and Credit Card Tipping to Unionized Workers
Starbucks cases keep on coming.
Starbucks Corporation, JD(SF)-22-24, 19-CA-303717 (ALJ Decision)
This case involves multiple allegations against Starbucks Corporation, brought by Workers United Labor Union International, affiliated with the Service Employees International Union. The primary issues revolve around alleged violations of Sections 8(a)(1), (3), and (5) of the National Labor Relations Act (NLRA). The decision examines Starbucks’ actions regarding confidentiality of information, benefit eligibility, wage increases, and exclusion of unionized employees from credit card tips and related training.
Key Allegations:
Confidentiality of Information:
Fact: Starbucks’ Senior VP of U.S. Operations, Denise Nelson, posted a message on the internal Partner Hub stating that information about wages, benefits, and unionization was confidential and not to be shared outside the company.
Legal Analysis: The ALJ found this to be a violation of Section 8(a)(1) because it interferes with employees' rights to discuss their wages and conditions of employment, which are protected activities under the NLRA. The Board has consistently held that employees have the right to discuss these issues with coworkers and third parties.
Case Cited: Kinder-Care Learning Centers, 299 NLRB 1171 (1990) – The Board found that employees’ communications about their working conditions are protected when directed to other employees, the public, and third parties.
Benefit Plan Description:
Fact: The 2022-2023 Benefit Plan Description stated that union employees were not eligible for benefits unless their collective bargaining agreement specified such eligibility.
Legal Analysis: The ALJ ruled that this language did not violate Section 8(a)(1). The language indicated that benefit eligibility was subject to negotiation, rather than automatically excluding unionized employees from benefits.
Case Cited: Handleman Co., 283 NLRB 451 (1987) – The Board found lawful a benefit plan that left coverage for unionized employees subject to collective bargaining, indicating that benefits would continue pending negotiations.
Wage Increases:
Fact: Starbucks announced and implemented its FY 2023 wage increase, providing different increases based on whether stores were unionized or involved in union organizing.
Legal Analysis: The ALJ found that Starbucks violated Sections 8(a)(1) and (3) by discriminating against unionized employees and those involved in union organizing, providing them with lower wage increases compared to non-unionized employees.
Case Cited: NLRB v. Great Dane Trailers, Inc., 388 U.S. 26 (1967) – The Supreme Court held that it is unlawful for an employer to withhold benefits to discourage union activity.
Exclusion from Credit Card Tips and Training:
Fact: Starbucks excluded employees from receiving credit card tips and related training based on their union activity.
Legal Analysis: The ALJ determined this to be a violation of Sections 8(a)(1) and (3), as it discriminated against employees due to their union involvement, which is protected under the NLRA.
Case Cited: NLRB v. Exchange Parts Co., 375 U.S. 405 (1964) – The Supreme Court ruled that both granting and withholding benefits to influence union activity constitutes interference with protected right.
Unilateral Rescission of COVID-19 Benefits:
Fact: Starbucks unilaterally rescinded COVID-19 related benefits (isolation pay, vaccine pay, etc.) for unionized employees without bargaining.
Legal Analysis: The ALJ found these were mandatory subjects of bargaining that could not be unilaterally changed.
Case Cited: Los Robles Regional Medical Center, 372 NLRB No. 120 (2023) - Held that unilaterally rescinding temporary COVID-19 benefits violates Section 8(a)(5) even if they were unilaterally implemented initially.
Paragon Professional Services, LLC and Asset Protection and Security Services, LP (Joint Employers), 28-RD-320410 (Regional Election Decision)
This decision by NLRB Regional Director Cornele A. Overstreet addresses petitions filed by Alex Guerrero to decertify International Union, Security, Police and Fire Professionals of America (SPFPA) Local 725 as the collective bargaining representative for certain security officers employed by Paragon Professional Services, LLC and Asset Protection and Security Services, LP at an ICE facility in El Paso, Texas.
Key Issues
Petitioner's failure to serve required forms: The main issue was whether the petitions should be dismissed because the petitioner failed to serve NLRB Forms 505 and 4812 on the parties when filing the petitions, as required by Section 102.60(a) of the Board's Rules and Regulations. The Regional Director concluded that dismissal was not required, distinguishing this case from URS Federal Services, Inc., 365 NLRB No. 1 (2018), which dealt with voter list requirements under a different rule with specific consequences for non-compliance. The Regional Director noted that Section 102.60(a) does not specify consequences for non-compliance and showed leniency toward the unrepresented petitioner's unintentional error.
Lack of prejudice: The Regional Director emphasized that no party demonstrated prejudice from the petitioner's failure to serve the forms, as the Region had served the forms on all parties shortly after the petitions were filed.
Key Cases Cited
URS Federal Services, Inc., 365 NLRB No. 1 (2018) - Held that voter list requirements under Section 102.62(d) have strict timelines and consequences for non-compliance.
Valladares Landscaping Artists, LLC, 373 NLRB No. 29 (2024) - Noted that the Board has shown leniency toward respondents proceeding without counsel in the context of default judgments.
Avis Budget Group, Inc., Case 12-RC-153554 (Jan. 11, 2016) (unpublished) - Found that a petitioner's negligent failure to serve a petition did not require dismissal where the Regional Office served relevant parties, no prejudice was alleged, and there was no intentional falsification.