A coalition of labor groups sent a letter to the Securities and Exchange Commission (SEC) Friday, claiming that Starbucks has failed to disclose to shareholders $240 million in costs and liabilities for “anti-union activity” and unpaid wages, the latest salvo in the fight between organizing employees and the coffee giant.
FILE - This Thursday, Jan. 12, 2017, file photo shows a Starbucks logo sign in the window of one of ... [+]
The Strategic Organizing Center (SOC), which consists of several Northern American Labor groups, estimates that the coffee giant has amassed $153 million in costs based on what it alleges is “anti-union activity”— including $100 million in legal fees—and is liable for another $87 million between alleged “illegally denied wages and tips” and “illegal firings and store closings.”
The letter comes as the SOC, itself a Starbucks shareholder, has launched a proxy contest campaign to elect three labor-friendly nominees to the company’s board of directors.
The SOC is asking the SEC to require Starbucks to fully disclose those costs and liabilities to shareholders, claiming in a press release that “the shareholders have a right to know” of those costs before making a board decision.
Forbes has contacted both Starbucks and the SEC for comment.
The Annual Meeting of Shareholders—when the board vote is scheduled to take place—is set for March 13.
After Starbucks workers in Buffalo started the nation’s first Starbucks union, countless other locations across the country sought to follow. But Starbucks’ response to unionization efforts in Buffalo and beyond has come under scrutiny, with employees across the country filing unfair labor practice complaints with the National Labor Relations Board (NLRB). Last March, former Starbucks CEO Howard Schultz faced tough questioning from lawmakers over the company’s response to organizing employees. The coffee giant recently appealed a federal court ruling prompted by an NLRB complaint that the company illegally fired seven Memphis, Tennessee employees—that case will be heard in a Supreme Court case that will likely weigh questions over the NLRB process.
- That’s the number of open or settled unfair labor practice charges against Starbucks and its related companies across the country currently filed with the NLRB, agency spokesperson Kayla Blado said in an email update on Feb. 8. NLRB members, administrative law judges and federal district judges have issued a total of 50 decisions that ordered some form of relief, including ordering Starbucks reinstate a total of 46 employees, Blado added. Starbucks is appealing many of those decisions.
Starbucks did not immediately respond to a request for comment, but the company has cited a recent third-party report that concluded there is no evidence that the company has used “an anti-union playbook” and that it has been supportive of workers’ right to organize.
The SOC has floated three nominees for the Starbucks board: Maria Echaveste is a former senior official in the Clinton White House and corporate attorney who also served as administrator of the Wage and Hour Division of the U.S. Department of Labor from 1993 to 1997. Joshua Gotbaum, who previously held several White House roles, is currently a director and member of Thornburg Investment Management’s Audit Committee, serves as a trustee of the Pension Reserve Trust for the Commonwealth of Puerto Rico, and is chair of the Maryland Small Business Retirement Savings Board. Wilma Liebman is a former chair of the NLRB under former President Barack Obama—becoming the second woman to lead the organization after serving as a member from 1997 to 2011.