Investors representing more than $1.3 trillion in assets under management are urging Starbucks out of respect to the workers who successfully voted on Thursday to host at least one local coffee shop in Buffalo, New York.
Signatories include New York City CEO Scott M. Stringer, Northwest Alliance for Responsible Investment, Alliance of Sustainability Advisors and more. Trillium holds about $48 million of Starbucks stock.
“We are writing to urge the Company to accept the results of the December 2021 election and proceed expeditiously and in good faith to the results,” the letter read.
“As investors, we believe that Starbucks should adhere to international standards and best practices and its word about interacting in good faith with employees to maintain relationships. active labor,” it continued. “Effective human resource management is a key performance indicator that more and more investors are prioritizing.”
Starbucks declined to comment on the group’s comments.
The letter also raised concerns that Starbucks interfered in the election process by closing stores and to the top executives, including Rossann Williams, executive vice president of Starbucks North America, and Howard Schultz, the firm’s former chief operating officer, for Buffalo. The coffee chain giant has denied these claims, saying it is directly responding to employee concerns.
“I certainly apologize if someone thinks it’s threatening. That’s really what I’ve been doing for 17 years, so whether it’s something special for a partner or a situation. , I can’t say in every situation,” Williams said in a phone interview with CNBC on Thursday. “What I can say is that our partners asked us for help and we showed up, and they were absolutely right. We let them down and we apologize for that. “
In November, workers filed federal labor charges, accusing Starbucks of illegal activities such as engaging in a campaign of intimidation, intimidation and surveillance in response to a union push. The company has denied the allegations.
Starbucks Workers United also stated that the voting list created by Starbucks includes employees who are not eligible to work at other Buffalo locations but have been briefed for the cafes to vote on unify.
However, the results mark Thursday first successful attempt at merging Starbucks-owned locations in the United States since it went public nearly three decades ago. The decision could cause ripples in the restaurant industry.
Employees at Starbucks’ Elmwood Avenue location voted 19 to 8 in favor of unification under Starbucks Workers United, a branch of the Service Employees International Union. The result at the second coffee shop on Camp Street went to Starbucks, with 8 workers in favor and 12 workers protesting. But the union claims that some of the ballots filed were missing from that vote. Judgment at a cafe Tuesday on Genesee Street is pending due to challenged ballots. Both sides have until December 16 to bring challenges to the National Labor Relations Board, and further hearings could take place before the results are certified.
On Friday, Starbucks shares rose more than 1%, giving the company a market value of about $137 billion. As of now, the stock is up more than 9% year over year.
MKM Partners analyst Brett Levy wrote in a note to clients Thursday that he does not think the decision will have an immediate impact on Starbucks strategy or financial results. However, Levy said that Starbucks’ push to represent the union more broadly could lead to another round of pay hikes for workers. Separately, baristas in Mesa, Arizona, applied for a union election.
Additionally, if employees at other restaurant chains follow their lead, then Starbucks is one of the companies better positioned to absorb the higher costs, Levy said.
The full text of the letter is as follows:
Dear Mr. Johnson,
We, the undersigned investors, representing more than $1.3 trillion in assets under management, are writing about how Starbucks is responding to a group of workers’ consolidation efforts (” partners”) in Buffalo, NY. Specifically, we are writing to urge the Company to accept the results of the December 2021 election and proceed expeditiously and in good faith according to the results.
When Starbucks partners in Buffalo sought to form a union, we were concerned about statements appearing in public statements that appeared to be inconsistent with international standards. First, instead of accepting the three unions’ request for voluntary recognition, it appears that the Company attempted to use the National Labor Relations Board (NLRB) process to seek an election. Single nomination for all stores in the area. This tactic shows that the Company is trying to use the NLRB process, not in a neutral or good faith way to have a free and fair election, but to weaken unions as much as possible. good.
Furthermore, under NLRB guidelines, union election campaigns should be allowed to run under “laboratory conditions,” but Starbucks is said to have taken several steps to delay and frustrate efforts. force. The company appears to have indirectly intimidated employees through the closure of two of Buffalo’s locations linked to the organizing effort, sending out a top company executive, senior company officials, and more. company and managers under the premise of additional training and referring a large number of partners to the stores after the announcement of the union profile. This is in addition to reporting on the Company’s conduct of detainees meetings and directing employees to the “Partner Center” online reference, in which Starbucks employees are asked to listen to and read articles anti-union rhetoric, including a November 6 voluntary meeting with the former CEO. Howard Schultz. Although Starbucks insists that these actions are standard procedure, the sudden and numerous changes indicate that the company is trying to discourage union activity as much as possible.
As investors, we believe that Starbucks should adhere to international standards and best practices and its word about interacting in good faith with employees to maintain the labor relationship. positive action. Effective human resource management is a key performance indicator that more and more investors are prioritizing. Partnerships between companies and labor unions is a time-tested method that can have a positive impact on human capital. By providing workers with independent channels to communicate with management about suggestions, concerns and requests without fear of retaliation, unions promote effective workplace feedback loops. more fruitful.
The formation of labor unions is also a fundamental human right recognized by international law. Workers exercise their right to form a union as recognized by the OECD Guidelines on Multinational Enterprises, the Universal Declaration of Human Rights, the United Nations Guiding Principles on Business and Human Rights, and the International Labor Organization. The ability of workers to organize, act cooperatively and engage in collective bargaining is an important human right that can provide net benefits to companies and investors, and to society. On the contrary, allegations that the Company does not respect the rights of workers to exercise their freedom of organization increase reputational and legal risks for investors.
We therefore call on Starbucks Corporation, in the spirit of international standards and its pro-partner mission, to accept the results of the Buffalo election and move forward quickly and according to the results.
Best regards,
Trillium Asset Management
Investment Parnassus
