Starbucks Raising Barista Pay, Launching ‘North American’ Barista ChampionshipDaily Coffee News by Roast Magazine

A Starbucks seasonal coffee cup. 2023 press photo by Starbucks.

In a move likely to reverberate through the coffee retail industry, Seattle-based coffee giant Starbucks said it is raising retail worker pay by a minimum of 3% beginning Jan. 1, while expanding other benefits, such as vacation accrual and financial wellness tools. 

In an announcement today, the company also said it is launching a “North America Barista Championship,” which will be available only to employees in the United States and Canada. 

The company said the new employee wage and benefits incentive package is part of an ongoing investment of more than $1 billion since last year to improve employee and store experiences. The investment was announced after the temporary reappointment of Howard Schultz as Starbucks’ CEO and continues now under the leadership of current CEO Laxman Narasimhan.

The continued investment comes as Starbucks remains at the center of the barista unionization push in the United States. Employees at more than 300 of the company’s 9,000+ company-owned stores are unionized, according to an analysis of recent National Labor Relations board documents

Last year, the company raised its minimum wage for all hourly U.S. retail workers to $15,  which is incidentally 74 cents below the current minimum wage in Starbucks’ home state of Washington. 

Starbucks iced coffee

A Starbucks drink. Stock photo.

A federal Administrative Law Judge (ALJ) recently ruled that the company violated federal labor laws when it made the company-wide minimum wage increase in 2022 but did not extend it to unionized baristas.

In its announcement today, Starbucks did not clarify whether the new pay raises and benefits packages would be extended to unionized employees. The company has previously maintained in court that unilaterally extending wage and benefits increases to unionized employees would actually run afoul of federal labor laws, creating an “untenable situation.” Notably, contract negotiations, or lack thereof, between Starbucks and union representatives at more than 300 locations have yet to result in a single ratified contract. 

Starbucks did not immediately respond to DCN’s request for clarification on whether the new wages and benefits packages will be extended to unionized workers. 

The company did announce that, in addition to the continued $15 wage floor, all “eligible” current hourly workers will receive a minimum 3% pay raise beginning in the new year. Eligible employees with two to five years of experience will receive a minimum 4% pay raise, while eligible workers with five or more years of experience receive a minimum 5% raise. 

Additional benefits to employees will include earlier-accruing vacation time, beginning 90 days after hire; an expansion of Starbucks’ existing college tuition plan in partnership with Arizona State University; financial planning tools; and options for more flexible shift scheduling. 

The company is also introducing a new in-house barista competition, which it described as the “first-ever North America Barista Championship.” Starbucks previously introduced a United States barista championship, which was conducted in 2015 and 2016.

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