Starbucks must pay over $35 million to thousands of New York City workers after settling a charge that it violated workers' rights across 300 locations.
New York City Mayor Eric Adams and New York City Department of Consumer and Worker Protection Commissioner Vilda Vera Mayuga on Monday announced a $38.9 million settlement with Starbucks for widespread violation of the city’s Fair Workweek Law. This is the largest worker protection settlement in New York City history.
A multi-year investigation by DCWP found that Starbucks committed more than half a million violations of the law since 2021, illegally denying thousands of workers across more than 300 locations the right to stable and predictable schedules, as well as the right to pick up additional hours and earn more. Instead, the coffee arbitrarily cut schedules and illegally prioritized their own profits over their workers’ rights, city officials said.
The settlement announced today requires Starbucks to pay more than $35.5 million in restitution to over 15,000 workers harmed by Starbucks’ practices, as well as any additional workers who come forward. The settlement also requires Starbucks to pay $3.4 million in civil penalties and costs and requires the company to comply with the law going forward.
“It does not matter how big your business is or how much money your company makes, if you violate our workers’ rights, you will pay the price,” said Adams said in a statement.
The city's investigation found that most Starbucks employees in New York City never received regular schedules, making it difficult for workers to plan other commitments, such as child care, education or second jobs. Starbucks also routinely reduced employees’ hours by more than 15%, officials said, making it difficult for employees to know how much money they would make week to week or whether they would earn enough to get by.
Further, Starbucks denied workers the opportunity to pick up additional shifts, keeping them involuntarily in part-time work while continuing to hire new workers.
Under the Fair Workweek law, fast food employers in New York City must give workers regular schedules, work schedules 14 days in advance that are consistent with the regular schedule, premium pay for schedule changes, the opportunity to decline to work additional time, and the opportunity to work newly available shifts before hiring new workers. Fast food employers also cannot schedule a “clopening” shift (a closing shift one night, followed by an opening shift the very next morning) unless the worker consents in writing and receives a $100 premium to work the shift. Additionally, these fast food employers cannot fire or reduce the hours of a worker by more than 15% without just cause and must reinstate laid-off workers at their other locations.
“Baristas are what keep Starbucks running. From Astoria to South Slope, we are the ones who create the warm, welcoming environment Starbucks advertises. When this company cuts our hours, understaffs our stores, and busts our union, it makes it harder for us to do our job and create that great experience for customers,” said Kai Fritz, a barista at Starbucks.
Under today’s agreement, most employees who worked for Starbucks in an hourly position will receive $50 for each week worked from July 4, 2021 through July 7, 2024. Employees will receive a check in the mail this winter. Any employee who experienced a violation after July 7, 2024 may be eligible for compensation under the settlement by filing a complaint with DCWP.
The coffee chain, which said the city's law is hard to navigate because one minor schedule change can trigger a violation, has hired more people and implemented upgrades to its scheduling system.
"That means bigger rosters, better schedules, and upgrades to our scheduling tools," the company said in a blog post. "We’ve also added training and technology to help partners in New York City – and across North America—get the hours they want, when they want them."
.png;w=120;h=80;mode=crop)
