Starbucks' $1 billion commitment to expand benefits for workers at nonunionized stores is under scrutiny this week.
A National Labor Relations Board hearing is expected to determine by Friday whether Starbucks can offer more benefits to Seattle employees depending on a store's union status.
Starbucks acted against labor law by extending benefits to nonunionized stores only, an NLRB complaint claims.
At the hearing in Seattle that began Tuesday, union lawyers brought to the forefront the question after months of Starbucks announcing several extended benefits, such as wage increases and more tipping options, to nonunion employees.
According to an NLRB complaint, Starbucks told Seattle employees that "any new benefit that we create for the company, we are not permitted by law to offer that benefit to stores that voted for the union while they are in collective bargaining."
The union is arguing that, by withholding the benefits, Starbucks is discouraging union activity and breaking labor law.
Starbucks asked the NLRB to dismiss the case Tuesday, saying that the company has the right to "not grant enhanced wages and benefits to partners at nonunion stores while a petition for representation is pending at any store." As of Wednesday, the motion to dismiss has not been discarded.
In May, Seattle-based Starbucks announced $1 billion in investments toward employees and stores. The company said at the time that "new pay and benefits changes will apply to stores where Starbucks has the right to unilaterally make these changes," which does not include unionized or union-organizing stores.
Workers United, the union representing Starbucks stores across the U.S., is arguing that withholding these benefits is against the law because it discourages employees from engaging in union activities. The union is also arguing that Starbucks has been discriminating in hiring, tenure or terms and conditions of employees in order to demoralize unionizing.
Among other requests, the NLRB and union attorneys are asking that Starbucks provide back pay and other benefits to employees who were denied higher wages.
The NLRB administrative law judge is expected to make a decision on the case this week. Depending on the outcome, Starbucks can appeal the decision.
