FOIAengine Breaks Down Court Cases, NLRB Actions, and Recent FOIA Requests
On Brian Niccol’s first day four months ago as the new CEO of Starbucks, he sent out a memo to the coffee chain’s 200,000 employees. Starbucks had seen four CEOs in as many years. Labor strife was rampant. Sales were slumping. The stock (NASD: SBUX) was getting hammered. So Niccol had a tall order, no froth. He needed to reassure his people – the chain calls them “partners” – that he really did care about them, unlike, I guess you could say, the last guy who got fired; or the next-to-last guy before him, the billionaire founder who was supposed to right the ship, but didn’t; or, oh yeah, that guy before the next-to-last guy, who quit under fire.
“Starbucks was founded on a love for high quality coffee — handcrafted by our outstanding green apron partners and enjoyed with intention. Coffee is our heart,” Niccol wrote. Job number one, he continued, would be to “make sure our baristas have the tools and time to craft great drinks every time, delivered personally to each customer. For our partners, we’ll build on our tradition of leadership in retail by making Starbucks the best place to work, with career opportunities and a clear path to growth.” He wrapped up with a pledge: “Together, we will get back to what makes Starbucks, Starbucks.”
Based on developments since then, we’re wondering if everybody got the memo.
One week before the December holidays, the union representing 11,000 of the chain’s baristas at 525 locations across 45 states and the District of Columbia announced the results of a strike vote: “An overwhelming 98 percent of union partners voted in favor of the strike authorization, showing their willingness to do whatever it takes to protest hundreds of still-unresolved unfair labor practice charges and win a strong foundational framework for union contracts.”
The union, Starbucks Workers United, hammered Niccol’s pay package, which it said was worth $57,000 an hour. A Philadelphia barista, quoted in the union’s press release, said she was earning $16.50 an hour, with a promise of “a 2.5 percent raise next year, $0.40 an hour, which is hardly anything. It’s one Starbucks drink per week. Starbucks needs to invest in the baristas who make Starbucks run.” (In a statement last month, Starbucks confirmed that the average pay for its baristas is about $18 an hour.)
To sharpen its point, the union mounted a five-day strike over the Christmas and Hanukkah weekend, with walkouts and picket lines at union-represented locations in Chicago, Los Angeles, Seattle and elsewhere. The union said contract negotiations were at an impasse.
The strike didn’t faze Starbucks’ head of human resources, whose title is “chief partner officer.” She responded with a cheerful holiday message (“Happy holidays, partners”), but further down was a harsher message signaling more trouble: “Workers United proposals call for an immediate increase in the minimum wage of hourly partners by 64%, and by 77% over the life of a three-year contract. These proposals are not sustainable, especially when the investments we continually make to our total benefits package are the hallmarks of what differentiates us as an employer – and, what makes us proud to work at Starbucks. The union chose to walk away from bargaining last week. We are ready to continue negotiations when the union comes back to the bargaining table.”
Statements like those above, from Starbucks management and the union, provide some insight into how and why the ongoing labor controversy is heating up again. But a key question, not just for Starbucks but also for the more than 2,000 hedge funds that own two-thirds of all outstanding shares in the S&P 100 company, is whether the unrest will settle down any time soon.
At PoliScio Analytics, we look for signals of what’s to come. In the case of Starbucks, the forward-looking metrics include litigation, National Labor Relations Board actions, and Freedom of Information Act requests to the NLRB. Let’s have a look.
- Litigation: When Law Street last looked at Starbucks litigation a year ago (See “Roasted: The Lawsuits Faced by America’s Biggest Coffee Chain”), the unionization controversy hadn’t blown off the courthouse doors. But that may be changing as cases make their way through the NLRB and into the federal courts. Following are some indications.
- Last June, the Supreme Court handed Starbucks a significant win when it ruled 8-1 against the NLRB in a case involving the standard to be applied in granting a preliminary injunction. At issue was the burden of proof imposed on an employer – in this case, Starbucks – while the NLRB conducts administrative proceedings to determine if the employer committed an unfair labor practice. The plaintiffs were a group known as the Memphis Seven – Starbucks baristas and shift supervisors who were fired by the company in February 2022, days after they announced their intent to unionize. Starbucks said the employees had violated multiple company policies, including allowing a television crew into the store after hours. The workers said they were fired for trying to organize a union. The NLRB urged the justices to stay out of the case. In its near-unanimous opinion, the Court tightened preliminary-injunction standards for the NLRB, a clear loss for the agency, and sent the case back.
- Cases listing Starbucks as a party in litigation now total more than 12,000, according to Docket Alarm. Over 1,500 of those court cases also involve the NLRB. The graphic below illustrates the recent trend.
- NLRB Cases: As of this writing, the NLRB’s dashboard lists 2,037 pending NLRB actions involving SBUX, with the number rising daily. Starbucks Workers United filed at least 34 NLRB complaints against the company in the last week alone. The new actions signal that the union isn’t buying into Niccol’s efforts to end hostilities and turn the company around. The latest NLRB filings accuse Starbucks of violating federal labor law by singling out and firing employees because of their union activism.
- FOIA Requests: PoliScio Analytics’ competitive-intelligence database FOIAengine, which tracks FOIA requests in as close to real-time as their availability allows, lists dozens of recent requests to the NLRB about Starbucks. FOIA requests to the federal government can be an important early warning of bad publicity, litigation to come, or uncertainties to be hedged and gamed out. The NLRB stopped publicly posting its FOIA logs 15 months ago. But NLRB logs recently provided to FOIAengine, covering September and October (the latest months available), reveal Starbucks sharing the top spot with problematic Boeing among FOIA requests about corporations. Where intentions could be discerned, the requests either were from reporters and news organizations covering the ruckus, or from litigants seeking an end-around discovery. Typical of the latter was this request for the following NLRB records:
- “All text message communications from a named Board Agent, using a specified phone number, with representatives of Starbucks Corporation (including but not limited to a named attorney) between January 1, 2023, and February 12, 2024; and all call records (including call logs, dates, times, and durations) from the same NLRB agent using the same phone number, with representatives of Starbucks Corporation during the same time period (January 1, 2023, and February 12, 2024).”
When Starbucks announced its full-year fiscal 2024 results last October 30, revenue was down and the company didn’t try to spin the headline: Results Reflect Challenged Customer Experience; Management is Developing a Plan to Get Back to Starbucks. Niccol was quoted: “We have a clear plan and are moving quickly to return Starbucks to growth.”
The next SBUX earnings call will be in early February, when Niccol will be quizzed about what, exactly, his plan is. In the meantime, the company has been quiet, as the litigation mounts.
FOIAengine access now is available for all professional members of Investigative Reporters and Editors, a non-profit organization dedicated to improving the quality of journalism. IRE is the world’s oldest and largest association of investigative journalists. Following the federal government’s shutdown of FOIAonline.gov last year, FOIAengine is the only source for the most comprehensive, fully searchable archive of FOIA requests across dozens of federal departments and agencies. FOIAengine has more robust functionality and searching capabilities, and standardizes data from different agencies to make it easier to work with. PoliScio Analytics is proud to be partnering with IRE to provide this valuable content to investigative reporters worldwide.
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Next week: Noteworthy FOIA requests about the Pentagon’s leaders.
John A. Jenkins, co-creator of FOIAengine, is a Washington journalist and publisher whose work has appeared in The New York Times Magazine, GQ, and elsewhere. He is a four-time recipient of the American Bar Association’s Gavel Award Certificate of Merit for his legal reporting and analysis. His most recent book is The Partisan: The Life of William Rehnquist. Jenkins founded Law Street Media in 2013. Prior to that, he was President of CQ Press, the textbook and reference publishing enterprise of Congressional Quarterly. FOIAengine is a product of PoliScio Analytics (PoliScio.com), a new venture specializing in U.S. political and governmental research, co-founded by Jenkins and Washington lawyer Randy Miller. Learn more about FOIAengine here. To review FOIA requests mentioned in this article, subscribe to FOIAengine.
Write to John A. Jenkins at JAJ@PoliScio.com.