Starbucks Case








Starbucks Case









The workers’ freedom of association is crucialto their effective operation in any organization.Besides fulfilling their assigned obligations, workers ought to have a body that fights for their rights, lobby for good working conditions, push for higher remunerations and generally voicing their pleas to their employers. This is achieved through a union, which tables workers’ needs and concerns of relevant parties, including labor departments and the government.Two theories, (The Webbs theory and Selig Perlman’s theory), are used to explain the situation in the Starbucks’ unionization of the workers’ case. Similarly,the probable outcomes of the situation and the reason behind that opinion will be addressed.This essay looks at the formation of unions to fight for workers’ rights.

Emergence of trade unions is a source of relief to workers in industrialized work structures (McQuarrie, 2015).In reference to Starbucks’ case on unionization of workers, the Webbs’ theory: The Effects of Industrialization best explains the situation. In Starbucks – leader in premium-price caffeine fixes, some employees were pushing for unionization efforts at several of the company’s Manhattan cafes. However, the company was against the union supporters and as a result, it fired three of them, who wereMr. Gross, Joe Agins Jr. and Isis Saenz.A Starbucks manager is also alleged to have illegally prohibited employees from talking about wages and other terms of employment.The Webbs theory comes in handy, as it highlights some of the benefits of having a union; one being, negotiating workers’ terms and conditions with the employer. This would result to improved members’ lives, fair and consistent rules in the workplace and adequate wage rates. Despite the frequent wrangles between Starbucks and the Starbucks Workers Union (SWU), the workers stand a better chance of airing their grievances.The union is reported to persistently pressure Starbucks by demonstrating outside shops and handing petitions to management demanding improvements in working conditions.

A union serves as an intermediary between the workers and the legal structures within a region or country. The Webbs theory points out another benefit of a union, which is, lobbying governments to enact laws guaranteeing basic minimum employment standards. This would lead to the representation of workers’ interests at a higher level, that of key decision makers (McQuarrie, 2015).Starbucks workers were lucky that the National Labor Relations Board intervened in the firing case. Administrative judge, Mindy E. Landow, made a ruling upon Starbucks that the company had illegally fired the employees, thus violating federal labor laws. In addition, Starbucks had also broken the law by issuing negative job evaluations to union supporters and prohibiting employees from discussing the union.To their relief, the judge ordered that Starbucks fired workers be reinstated and receive back wages. In March 2006, the unionreached a settlement of $2,000 as back payand reinstatement of two New York baristas who had beenfired illegally.

A company’s corporate image is key to its success. Starbucks ruined its corporate image and reputation for social responsibility and sensitivity to workers’ rights following the legal wrangle with SWU.The consequences involved a decrease in demand of their coffee following an economic decline, an overall loss of flair for the brand and a sliding stock price. As highlighted in both The Webbs and Perlman’s theories, industrialization caused a separation between capital and labor (McQuarrie, 2015).In this context, Starbucks exercised capitalism in a factory-based economy. The company provided capital and controlled how labor was used in the production process. From The Webbs’ analysis, the division between capital and labor made owners and business people to exploit labor for their own gain to maximize their return on their investment, by minimizing production cost including wages. A similar scenario was witnessed at Starbucks, where the company laid off some of its workers, thus reducing its production cost by minimizing wages. The company’s shares are said to have reduced by over 50% in value in 2008, while rival firms such as Dunkin Donuts and McDonald’s (MCD) continued to grab market share among coffee drinkers. The discriminatory treatment of the pro-union workers set the company crumbling down.

To be successful in representing the workers’ concerns to capitalists, unions need the support of the middle class and upper class (not just the working class).This is a suggestion by theoristSelig Perlman (McQuarrie, 2015).The Starbucks Workers Union had managed to woo the support of the middle classand upper class (the audience and the legal forces) and hence made it easier for them to reach out to the capitalist company, Starbucks. It is reported that the Starbucks’ core audience comprises of people who are paying attention to employee relations. This means that the company’s employee mishandling is not only critiqued by the union, but also by the potential customers. As Pearlman says, gaining more support from the middle class and upper class would help the union’s concerns more widely circulated and noticed. However, Pearlman discourages unions from letting the middle class or upper class dominate them, the reason being, they might be sympathetic to the union’s goals and thus not sensitive to workers’ concerns. The theorist proposes to unions to adopt the psychology of the laborerwho, unlike the middle or upper class, has had experience of work scarcity, lack of jobs and/ or difficulty in finding jobs in the highly competitive market. Their views are shaped by practical realities and are thus more sensitive to workers’ concerns.

If unions supported some capitalism principles rather than reject them outright, they would be seen as cooperative and not radical, thus gain more acceptances by society, beyond the working class. Perlman pointed out such principles such as respect for the ownership of private property (McQuarrie, 2015).If SWU had their limits in their approach of the workers’ rights issue, probably the company would have been more willing to compromise on the workers’ concerns.A certain court document said that the union staged demonstrations which intimidated customers and employees. Their supporters were alleged to engage in uncouth behavior such as vandalism and blocking access to stores. Instead of such misconduct, they would have peacefully requested the Starbucks management to come to an agreement on how they are going to improve their treatment for the workers.

Despite the many instances of employees being ill-treated, several scholars have made positive remarks about the company.Fellner (2008) acknowledges that Starbucks treats workers better than many other restaurant companies. The author of The Starbucks Experience, Joseph Michelli said that the company has been amazing in the way they treated their employees.

Perlman proposes that unions should focus on creating economic security and opportunity for members rather than focusing on ownership of businesses. He felt that this strategy would create a stable, long-term basis for union existence (McQuarrie, 2015).The Starbucks Workers Union partly went contrary to Perlman’s proposal, by focusing on taking possession of the means of production and abolishing the wage system. However, SWU put economic security of their members at its heart. In a certain instance, one member of the union, Anna Hurst, once suffered heat stroke on the job, prompting her store manager to take her off the schedule for two weeks.Some union supporters approached the manager and demanded him to compensate Hurst for the two weeks he put her off schedule. A non-recommendable act that the union did was leafleting customers and picketing on New Year’s Eve.

One of the union’s key objectives is to protect workers’ interests against pressures caused by owner’s or business person’s financial situation. This is one aspect that The Webbs identified in their theory, which is the effects of industrialization (McQuarrie, 2015).Starbucks appeared to disregard this aspect of working their employees overtime in exchange for health coverage. It is reported that, an employee is subjected to twenty or more hours per week to be eligible for health coverage. For those who want full-time work of more than 32 hours weekly, they must be open to work at least 70 percent of a store’s operating hours. This is an oppressive schedule that hinders employees from engaging in other important aspects of their lives. The union comes in handy to advocate for fair and convenient working hours.

The Webbscontemplated that poor working conditions are not merely workplace problems, but also, a portrayal of larger societal problems (McQuarrie, 2015). Clarence Belnavis, managing partner in the Northwest office of the National Labor and Employment law firm, Fisher &Phillips, LLP cited that Starbucks is not the only company experiencing employee relations problems. It is a widely spread crisis. One of the external factors influencing poor work conditions is a bad economy, something that is beyond an organization’s/ company’s control.

This is a case of the Starbucks Company versus the Starbucks Workers Union. The probable outcome is that Starbucks, as an organization, is likely to lose its labor forces. This is because the workers may quit due to the unfavorable working conditions they are subjected to. The few who may remain are likely to enjoy better treatment, since the companywould not like to completely lose its work force. Furthermore, having ruined its reputation, the least it can do is improve on its employee relations. For the union, it is likely to get more members who may feel that their job security and rights are being fought for. Eventually, the overall morale of the workers will be boosted and they will be more willing to work in whichever organization, since they are assured of their rights being protected.


In a capitalist economy, the workforce undoubtedly needs a union to represent their needs and concerns before relevant bodies. These include the labor department, the employer and even the government, lest the capitalists take advantage of the labor force to enrich themselves. All in all, there is a need for mutual respect between the capitalists and the unions, lest the employees suffer the consequences. It is hard to have a win-win situation, but with a degree of compromise, nothing is impossible.




Fellner, K. (2008). Wrestling with Starbucks: Conscience, capital, cappuccino.New Brunswick: Rutgers University Press.

McQuarrie, F. (2015).Industrial relations in Canada.New Jersey: John Wiley & Sons, Inc.


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