Former Starbucks CEO Howard Schultz testifies before Senate panel | full video

he's not good the senate committee on health education labor and pensions will come to order and let me get to the point of this hearing today in our country over 60 percent of our people are living paycheck to paycheck and millions are working for starvation wages unbelievably despite an explosion in technology and huge increases in worker productivity the average American worker is making 50 dollars a week less than he or she made 50 years ago after adjusting for inflation unless we change the nature of the way our economy works it is all too likely that our younger generation will have a lower standard of living than their parents what this means in reality is that workers throughout our country are struggling to pay for housing struggling to pay for health care and prescription drugs struggling to put food on the table struggling to pay off their student debts and to deal with other basic necessities of life and while that is the reality for the working class of this country here is another reality and that is that the people on top have never ever had it so good today in America we have more incoming wealth inequality than we have ever had with the top one percent now owning more wealth in the bottom ninety percent with CEOs now making 400 times what their workers are making and with three people at the top owning more wealth in the bottom half of American society that is the economic reality that exists today people on top doing extraordinarily well millions of Working Families struggling and as a result of that economic reality what we are now seeing is a major increase in Trade union organizing throughout our country in Blue Collar jobs and in White Collar jobs workers are standing up and they are fighting back to form unions in order to improve their wages their benefits and their working conditions these workers know as I do that union workers earn 20 percent more on average than non-union workers these workers also know as I do that union workers have better health care benefits better paid family and medically policies are much more likely to have a pension and are less likely to be victims of health and safety violations compared to non-union workers at a time when 71 of the American people now approve of unions the highest level since 1965. there has been a major revitalization of the Trade union movement in this country between 2021 and 2022 the number of a union union elections taking place in America has gone up by 53 percent and since 2020 workers have voted to form a union in over 70 percent of Union elections rather extraordinary and now that is the good news for those of us who understand that strong unions are a vital part of rebuilding the declining middle class in this country that's the good news the bad news is that in order to combat there's increase in Union organizing corporations have engaged in an unprecedented level of illegal union busting activities which takes us to the focus of today's hearings over the past 18 months Starbucks has waged the most aggressive and illegal Union bustling campaign in the modern history of our country that Union bustling campaign has been led by Howard Schultz the multi-billionaire founder and director of Starbucks who is with us this morning only under the threat of subpoena let us be clear about the nature of Starbucks vicious anti-union efforts the National Labor Relations Board nlrb has filed over 80 complaints against Starbucks for violating federal labor law there have been over 500 unfair Labor practice practice charges lodged against the company and judges have found that Starbucks broke the law a hundred and thirty times across Six States since workers began organizing in the fall of 2021. these violations include the illegal firing of more than a dozen Starbucks workers for the crime of exercising their right to form a union and collect collectively bargain for better wages benefits and working conditions since the first Starbucks Union was certified more than 450 days ago in Buffalo workers at more than 360 stores across 40 states have held Union elections 83 percent of these elections have resulted in a union victory and today nearly 300 Starbucks coffee shops employing more than 7 000 workers have a union despite Starbucks aggressive anti-union efforts but with nearly 300 shops voting to form a union Starbucks has refused to sign a single first contract with the Union not a single one think about that think about a multi-billion dollar company with unlimited Resources with all kinds of lawyers advisors consultants and yet they have not yet signed one contract with any of their nearly 300 unionized shops just a few weeks ago on March 1st an administrative law judge found Starbucks guilty of quote egregious and widespread misconduct end quote which showed quote a general disregard for the employees fundamental rights end quote in a 220-page ruling this judge found that Starbucks illegally retaliated against employees for unionizing promised improved pay and benefits if workers rejected the union conducted illegal surveillance of pro-union workers refused to hire prospective employees who supported the union relocated Union organizers to new stores and over staff stores ahead of Union votes all clear violations of federal labor law the judge also found that Starbucks quote widespread coercive Behavior over six months had permeated every store in the Buffalo marketing quote the judge ordered Starbucks to reinstate seven workers who were wrongfully terminated reopen a pre-pro union store in Buffalo that was illegally shut down and pay quote reasonable consequential damages end quote to more than two dozen saw or Starbucks workers whose rights were violated by the company and let us be clear Starbucks egregious Union bustling campaign is not limited to Buffalo it is happening All Over America federal courts in Tennessee and Michigan have issued emergency injunctions requiring Starbucks to reinstate workers who were illegally fired and to prohibit the coffee chain from firing workers for supporting unionization efforts in the future in Scottsdale and Phoenix Arizona the nlrb has charged Starbucks with committing eight violations of labor law when it disciplined fired and forced out workers because they cooperated with Federal investigations on November 30th of last year the nlrb found that Starbucks unlawfully refused to recognize and bargain with the Union at its Reserve Roastery store in Seattle nlrv judges have found that Starbucks illegally threatened to hold withhold benefits including health insurance from pro-union workers in Denver Overland Park Kansas Seattle Washington and Ann Arbor Michigan the pattern in all of these stores is clear on one hand we have workers making 13 14 15 an hour with minimal benefits working 20 hours a week 30 hours a week maybe 40 hours a week depending on a totally unpredictable schedule dictated by their managers and these workers are out there struggling today to achieve dignity and Justice on the job that's what they are trying to do and I applaud their efforts and on the other hand we have a corporation worth some 113 billion dollars largely controlled by an individual worth some four billion dollars who are using their unlimited resources to do everything possible legal and illegal to deny these workers their constitutional right to form a union the fundamental issue we are confronting today is whether we have a system of justice that applies to all or where the billionaires and large corporations can break the law with impunity I have read Mr Schultz's comments to the media in which he expresses his strong anti-union views as an American Mr Schultz is entitled to those views and any other views he holds but even if he is a multi-billionaire and the head of a giant Corporation he is not entitled to break the law so today I will be asking Mr Schultz whether he will do what an administrative judge law judge has ordered him to do and that is to record and distribute a 14-page notice which states that Starbucks has violated federal labor law to inform Starbucks employees all across this country about their rights on the National Labor Relations Act how Starbucks has violated those rights and to assure that Starbucks will not infringe upon those rights in the future in other words I will be asking Mr Schultz whether or not he intends to obey the law further I will be asking Mr Schultz another question and that is whether or not he is prepared to promise this committee that within 14 days of this hearing Starbucks will exchange proposals with the Union something that it has refused to do for more than 450 days so that meaningful progress can be made to bargain a first contract in good faith and let me conclude by saying that what is outrageous to me is not only Starbucks anti-union activities and their willingness to break the law it is their calculated and intentional efforts to stall to stall and to stall they understand that the turnover rate at Starbucks and many other similar type companies is high they understand that if workers see do not seek success in gaining a contract they are going to get discouraged and give up the fight at a time when we want in this difficult time in our country for people to stand up and fight for their rights to try to destroy the spirit of thousands and thousands of people who are fighting for justice back to my mind is Unforgivable Senator Cassidy thank you chairman Sanders workers have a right to organize now some may disagree as to whether the protections for workers who choose to organize should also apply to to workers who choose not to organize that's my position but examining this Nuance is not an issue here the title of today's hearing is no company is above the law the need to end illegal union busting at Starbucks now that clearly presumes that Mr Schultz and his former employee are guilty before the allegations are fully investigated the title suggests that this hearing is not a good faith effort to get at the facts it's a smear campaign against an individual and a company and a company based upon allegations that everyone knows are still under litigation I am not here to defend Starbucks I have my own questions about the alleged misconduct and the law should be followed and upheld I agree with the chair no one is above the law but let's not kid ourselves this is not a fair and impartial hearing now it's not surprising that Mr Schultz was reluctant to testify when the majority is using the title of the hearing the slander the witness we're asking to testify it sends a signal the majority points to claims of Starbucks misconduct filed at the National Labor Relations Board to justify today's hearing these allegations should be addressed and they should be investigated period but it would be malpractice for this committee to not also acknowledge that nlrb is currently facing its own credibility crisis the nlrb confirmed there are four separate allegations of nlrb employee interference three of which the employer was Starbucks pending before the board it begs the question are nlrb employees weaponizing the agency against American employers to benefit politically connected labor unions the National Labor Relations Act was passed to provide an unbiased framework to review disputes between employers and employees the nlrb carries out the law and is required to protect the rights of all parties in a labor dispute not put their thumb on the scale in favor of unions but that is not what we appear to be seen in practice an nlrb hearing officer recently substantiated reports of voting irregularities in a union election at a Starbucks in Kansas that could potentially Elevate to the level of misconduct by nlrb employees this includes nlrb staff providing duplicate ballots supplying Union organizers with confidential voter information providing voter accommodations to employees selected by the union without offering them to all employees regardless of the outcome these actions are on Direct violation of federal law and nlrb written guidelines now today we'll hear from former Congressman Bradley Byrne he is representing the brave whistleblower who brought this misconduct and weaponization of the agency to like he'll be able to provide more insight into how the nlrb is operating in violation of its own practices in a procedure in a way which favors labor unions let's be clear and one more time workers have a legal right to unionize companies cannot break the law to prevent unionization similarly unions should not be allowed to intimidate workers into unionizing through coercion or by Banning secret ballot elections which the Supreme Court has stated quote indeed the preferred end quote method to gauge worker support of unionization this is a conversation this committee can have and will continue to have but the bottom line is that a federal agency has no right to break the law to advance a political agenda and this should be something that our committee investigates on a bipartisan basis the committee is going to properly investigate concerns over Labor Relations at Starbucks we should also investigate alleged misconduct of the agency that sought to influence the union representation process now last week's hearing I said we should thoughtfully examine legitimate policy issues not hold show trials for public shaming today looks like more of what we saw last week there are important bipartisan things the committee needs to accomplish we need to work together on real solutions to issues facing American families like the high cost of prescription drugs getting Americans back to work driving down inflation that is choking economic growth instead we put CEOs on the dock but instead of a cage in which the in which the The Prisoner was formally cut is a desk in front of the committee where a judgment has already been made thank you and I look forward to today's testimony thank you Senator Cassidy we will now turn to our witness Mr Howard Schultz is the former long time Chief Executive Officer of Starbucks and a member of the Starbucks board of directors Mr Schultz you may proceed with your testimony thank you very much Mr chairman good morning chairman Sanders ranking member Cassidy and centers of the committee I'm pleased to be here this morning and tell the entrepreneurial story of Starbucks and how we have carried the American flag to 84 countries around the world my vision for Starbucks Coffee company has always been steeped in humanity respect and shared success it's a vision that was inspired by the struggles of my father a World War II veteran who slipped on a sheet of ice in 1960 and was promptly fired from his job as a delivery driver it fractured our family and it deeply scarred me I decided at an early age that if I was ever in a position to run a business it would be based on respect and shared success with my one-year term as Starbucks interim CEO having come to a close I appear before you today with love and gratitude for what we have built at Starbucks over these last 40 years the essential operating Approach at Starbucks since 1987 when we had just 11 stores has focused on values-based decisions we've always believed that if we exceed the expectations of our people they in turn will exceed the expectations of our customers we call our employees Partners this is a very important point to share with the committee because since 1991 we established shared ownership for every single person in the start at Starbucks full and part-time unprecedented more than 30 years ago before the company's IPO Starbucks created two unprecedented benefits for our partners it was the first of its kind in all of American Business never done before Starbucks Beanstalk program a stock Equity program and access to health care almost 25 years before the Affordable Care Act for full and part-time workers who work 20 hours a week my written testimony has details on the benefits and opportunities we've created for our people over the past 40 years this represents Decades of work striving to build a different kind of company that lifts our customers and gives our partners a chance at a better life according to Aeon one of the most respected benefits in HR consultancies in the country this is their voice not ours there's literally no company no company in our competitive set of retail that offers higher value benefits than Starbucks in the United States and Senators we did this by building a direct relationship with our partners built on trust and shared success based on a 40-year track record of benefits and actions to create opportunity today Baristas in our stores earn on average 17.50 respectfully that's more than the minimum wage of every Senator that's represented a state on this committee including respectfully chairman Sanders where the minimum wage in Vermont is 1318. we're at 1750. with benefits and other income included such as a hundred percent paid college tuition the first of its kind in American Business Comprehensive Health insurance and beanstock Equity the average value approaches twenty seven dollars an hour and what I'm most proud of is today 63 percent of our retail managers started out as our libarista's underscoring the opportunity we provide for shared growth and success and our employee retention is twice the industry average let me repeat employee retention at Starbucks is twice the industry average and throughout our history we have addressed the issues most critical and most important to our people including pay Equity paid sick leave fully paid parental leave support of our partner networks financial literacy sustainability hiring military veterans and their spouses over thirty thousand to date partnering on food security and offering industry leading mental health support the vision and track record and ongoing pathway for employees has led our industry a small number of our partners about one percent have chosen a different approach as is their right under law and while we are while we care deeply about each and every one of our partners we are limited by law and what we can unilaterally in Union do in Union environments we are 100 committed to fulfilling our obligations as an employer under the National Labor Relations Act and are committed to good faith negotiations on first contracts for each unionized store a year ago I came back to Starbucks as interim CEO and concluded that assignment last week well not a one-year fix we are back on the right path and have demonstrated that by 1.4 billion dollars of employee facing Investments that we made this year every day we wake up thinking about how we can put our people first put them in a position to win and do everything we can to demonstrate the conscience the heart and the values of Starbucks coffee company that has been the Starbucks way for the last 40 years since 1987 when we had 11 stores and 100 employees with that I welcome your questions Schultz thank you very much my time is limited is is the time of all of our members here so I'm going to be asking you to respond to each question is briefly as you can hopefully with a yes or no do you understand that in America workers have a fundamental right to join a union and collectively bargain to improve wages benefits and working conditions do you understand that I understand and we respect the right of every partner who wears a green apron whether they choose to join the union or not are you aware that nlrb judges have ruled that Starbucks violated federal labor law over 100 times during the past 18 months far more than any other Corporation in America Starbucks Coffee Company unequivocally let me set the tone for this very early on has not broken the law okay are you aware that on March 1st 2023 an administrative law judge found Starbucks guilty of quote egregious and widespread misconduct end quote widespread coercive Behavior and showed quote a general disregard for the employee's fundamental rights end quote in a union organizing campaign that started in Buffalo New York in 2021 are you aware of that I'm aware that those are allegations and Congress has created a process that we are following and we're confident that those allegations will be proven false all right Mr Schultz before answering the following questions let me remind you that federal law at 18 U.S code section 1001 prohibits knowingly and willfully making any fraudulent statement I understand that were you ever informed of or involved in a decision to fire a worker who was part of a union organizing Drive I was not were you ever informed of or involved in a decision to discipline a worker in any way who is part of a union organizing tribe I was not have you ever threatened coerced or intimidated a worker for supporting a union I've had conversations that could have been interpreted in a different way than I intended that's up to the person who received the information that I spoke to him about were you informed of or involved in the decision to withhold benefits from Starbucks workers in unionized stores including higher pay and fast the sick time accrual my understanding when we created the benefits in May one month after I returned to CEO my understanding was under the law we did not have the unilateral right to provide those benefits to employees who were interested in joining a union am I hearing you say that you were involved in the decision to hold benefits from Starbucks workers in unionized stores is that what I'm hearing it was my understanding that we could not provide those benefits under the law Mr silch have you ever asked the slobuch's worker quote if you hate Starbucks so much why don't you go work somewhere else I'm glad you asked that question because I've read in the Press uh that quote and that's not exactly what I said can I tell the story do you mind I have some other questions I'm sorry a lot of people I think it's important to hear the facts you'll have your chance will you commit to testifying in any trial where you personally are accused of breaking federal labor law something that you have been accused of doing nearly 100 times since 2021. Mr chairman let me say under oath these are allegations and Starbucks has not broken the law okay Mr Schultz were you informed of or involved in this in the decision to close all Buffalo area stores in November 2021 just days before area Union elections in order for Starbucks employees to listen to you give a speech on why they should vote against formula Union a meeting the nlrb has determined was a violation of the law I think this is another area that I hope I get a chance to speak about for the last 12 months my involvement my engagement and my return to Starbucks has been primarily I would say 95 focused on the operations of our business the customer domestically and around the world my involvement and engagement in Union activities despite this event today has been de minimis I was not involved in any issue of closing stores are you aware Mr Schultz that an administrative law judge ordered you to record and distribute a video of yourself reading a notice the Starbucks employees about their rights under the National Labor Relations Act how Starbucks violated those rights and to assure that Starbucks will not infringe upon those rights in the future and that this notice must be posted in all Starbucks stores and shared digitally to all of Starbucks employees are you prepared to read that notice no I am not because Starbucks Coffee Company did not break the law under your leadership Starbucks has repeatedly refused to bargain with any of the seven thousand workers in nearly 300 stores where workers have voted to represent themselves through Union the first group of workers to win their election have been waiting more than 460 days to reach a first contract Mr Schultz will you commit right now that within 14 days of this hearing Starbucks will exchange proposals with the Union something it has refused to do for more than 450 days so that meaningful progress can be made to bargain a first contract in good faith will you make that commitment because the arrangement that was made by the union and the nlrb in Buffalo to negotiate one single store at a time we have met over 85 times for a single store we've tried to arrange over 350 separate meetings we've said publicly and I say it here again that we believe that face-to-face negotiations is the way to proceed and the reason I want to make that point is that there have been safety issues in which Starbucks managers have been outed on social media there are privacy issues we don't want to do it on Zoom we are prepared to meet face to face on a single store issue will you make a promise to this committee that you will exchange proposals with the Union so that we can begin to make meaningful progress on a single store basis we will continue to negotiate in good faith that's what we'll do three minutes over Senator Cassidy I had a defer to senator Paul Ein rand's Howard Rorick points out the ingratitude that man has for the entrepreneur the Creator thousands of years ago the first man discovered how to make fire he was probably burnt at the stake he taught the others to light but he left them a gift that had not been conceived and he lifted Darkness from the face of the earth now Starbucks didn't exactly discover fire but Starbucks did somehow somewhere discover in the depths of man's soul that he would pay as much for a double mocha latte as he once did for a week's worth of coffee my wife Kelly and I tried to get my grandparents some fancy coffee once and my grandfather a survivor of the depression informed us in no uncertain terms that he drank Maxwell House 399 for a week's worth of coffee the Pauls although German often missed the Zeitgeist of the times and so while we continue to purchase Maxwell House others our contemporaries bought Starbucks stock and did much better than we did who knew people would pay six bucks for a cup of coffee but I digress convincing the public to buy very expensive coffee is not the discovery of fire but still it deserves respect instead Congress convenes today not to praise Starbucks but to bury them the hearing today is convened to attack a private company or its success when its success has benefited both customers and its employees alike we've heard of the average wages over Seventeen dollars we've heard of the 401K plans we've heard of the parental leave even for part-time employees Starbucks giving away tens of millions of dollars each year they have a hundred percent tuition and fee for bachelor's degree maybe it doesn't sound like too bad a place to work Starbucks is among the most charitable companies in the country since 2016 they've had a program to give away unused food to feed over 5 million hungry families Starbucks didn't do all this under orders from a government Bureau they did it because capitalism works we have more charity when we have more money when we have more success when we have more profit nobody buys six dollar coffee in impoverished Nations we're an extraordinarily Rich Nation Marion tupi and Gail Pooley wrote a book called Super abundance they say we live in an era of super abundance Starbucks can only exist in an era of super abundance the average calorie count since when I was born was about 2 800 has gone up to 3 700 many would already have too much food you can buy seven times as much food for the same amount of work or hours if you measure stuff in time prices how many hours of the average worker it takes to buy something it's extraordinary how wealthy we are even an inflation-adjusted terms from 1960 to today 1950 to today the average income inflation adjustments up four-fold these are all Extraordinary Tales this is also an extraordinary tale of a company that started out of nothing and employs tens of thousands of people all making great wages and we're here to say as if this is like you know Charles Dickens I mean we think it's 1812. I mean it's an amazing success story we live in the era of super abundance in 1820 96 percent of people lived on less than two dollars a day adjusted for inflation and how much of the world lives that way less than 10 percent trade capitalism profit people all the time are talking about we want sustainable this and sustainable that you know what's sustainable capitalism and profit and employment you want to put all those Starbucks workers in the government doll you want to have a government Coffee Company you know what are we talking about here if you don't want their coffee be like my family my Maxwell House but for goodness sakes don't deride one of the Great American sex success stories this is not who we are We Are Better Than This if the goal is to destroy the goose that laid the golden egg then by all means this hearing is a good beginning for me I see the fabulous success of Starbucks and I understand that luxury the luxury to spend an extraordinary amount of money for a cup of coffee is a testament to capitalism it's a testament to the fact that we have enough money that we can do that when I walk in Starbucks I don't see billionaires buying coffee I see everyone from top to bottom and they're paying for the coffee because they've decided the quality is worth it but I don't want to be part of any Witch Hunt that vilifies any American business so count me out count me as one who is ecstatic that Starbucks is an American success story and I'll have no part in trashing their success thank you uh Senator hickolooper you'll have to preside soon so you asked the first questions great thank you very much Mr chair ranking member and Mr Schultz I appreciate you coming uh before us and uh I realize that you've spent your life creating one of the most successful Brands uh in American history you mentioned the long-held aspiration to make Starbucks a company that balances profitability with social conscience um and I think that brand is is exceedingly attractive especially to young people and I think it's part of your success I think in many ways the ability of Starbucks to attract young workers and and and have them believe in the brand and the vision is a big part of that success which I think is part of what this group believes is that the the partnership between the company and the workers is is a key to success for for any successful company um many folks who work at Starbucks uh came because they wanted a chance to work for a company that prioritizes earnings and benefits uh wellness and your testimony described in some detail that you're near the top of that ladder um but we also heard over the last few weeks from other workers some from Colorado who told us they came to work for the partner-centric model but were disappointed because they wanted that opportunity to be part of a union and told us that that disillusionment uh has been very hard for them so I guess the question I would ask first is that that appearance that so many of the employees have of that their organizing efforts are being interfered with seems at odds with the commitment to the partner model uh and the and the worker welfare so how do you respond to those workers who appreciate the Starbucks model would would like to be able to organize with less uh less confrontation well thank you for the question and the opportunity to answer that you know without some of the propaganda that has been floating around you know I built my life trying to create a company that values every single person with dignity and respect it puts on the green apron that has not changed as a result of one percent three thousand four hundred people out of 250 000 who want to join the union we've said it publicly we respect the law we respect their right and we want to treat everyone with respect and dignity however I have the right and the company has the right to have a preference and our preference is to maintain the direct relationship we've had with our employees that we call partners and we have a track record that demonstrates the values that we have admit that we have shown and the value that we have created but we maintain a level of respect for everyone who wears the green apron thank you um there's been considerable questions about the shrinking middle class this is I'm not asking you to be an economist sure in this sense although you clearly know more than about economics and I will ever know uh but when you look at the charts and we've got a chart behind me that demonstrates that as the middle class has shrunken and his income inequality has uh increased dramatically it has directly coincided with the decline in unions and I certainly respect the the desire to be directly connected with all your employees uh but in many ways that that right to organize and that opportunity for people to to be part of a union uh is a crucial building block for the middle class and I think gave this country stability that we don't we don't see in the same way that we used to um at its core I think Union organizing is about having a greater say in in their in their workplace um and I think everybody always wants that that some of the studies show that entrepreneurs start new businesses not necessarily to make money but not to have someone bossing them around so what do you say to the workers who want to join together with their peers to unionize uh their workplaces despite however great Starbucks has been for yeah I've said before and I I want to repeat it I think unions have served a important role in American Business for many years and if you look at the 50s and the 60s unions generally were working on behalf of people in a company where those people have not been treated fairly where there's been in some cases nefarious acts by the employer taking advantage of the employee I can only say in my in my own company based on the tracker that we've had we do not believe and it's our preference that we are that kind of company we treat our people fairly we do nothing that is nefarious we put our people first we make decisions based on our people and we have the track record to prove it Starbucks is probably one of the best if not the best first job in America as I said in my opening statement 65 percent of Baristas are now managers I walked into a store an hour ago just at 24th and M just walked in was met by a guy named Nico never met him before 22 years with Starbucks and he tells me his story he came from Senegal he's an American citizen started as a barista became a manager district manager and the thing that he wanted me to know this is an hour ago is I bought a house and I have a car and I raised two kids because of Beanstalk at Starbucks now you put that overall in the last 15 20 years over two billion dollars of equity because of Beanstalk 14 of the of your time has expired yeah but it's important point two bill Equity because of everyone being an ownership back to our employees it's unprecedented and that's why Starbucks doesn't need a union Senator Cassidy um Mr chairman I will respectfully notice that you took seven minutes on yours so Mr Schultz should have been allowed to finish his statement Mr Schultz will have as much time as he needs to respond to the questions of 15 people Senator custody I defer to Senator Romney thank you Mr chairman and uh ranking member Cassidy uh I recognize at the outset there's some irony uh to a non-coffee drinking Mormon uh conservative uh defending a Democrat candidate for president in perhaps one of the most liberal companies in America uh that being said I I also think it's somewhat Rich that uh uh that uh that you're being grilled by people who have never had the opportunity to create a single job and yet they believe that they know better how to do so and what's best for the American worker and what's best for the American economy what's best for growth I also think it's Rich to not recognize the extraordinary conflict of interest we have which is our Democratic colleagues overwhelmingly get their campaign funds from unions and therefore would like to find every possible way to extend unions even if an Enterprise feels that it's in their best interest to pursue a different course now I know that there are a number of reasons why you might wish not to have a union organization in in your various Enterprises at the same time I agree with with Senator Cassidy with your own comments Mr Schultz which is that that people have a legal right to form a union there are some employers that are not good employers and the union is necessary to protect the rights of those individuals and that if any Enterprise including yours has broken the law that it should be held accountable for having done so the same time the legitimate reasons why an Enterprise might choose not to become unionized uh I I first would note that within your company there are probably some stores that are unions some that are non-union do the non-union store employees get paid less than the Union store employees the starting wage has been the same the only difference is the benefits that we created in May and my understanding under the law is that we were not allowed to provide those benefits to people who are organizing to join again and so in fact that non-union stores are actually a little better total package than than the union stores let me ask another question we'll just make another point and that is I wouldn't understand why you would not want to have an adversary relationship between the store manager and the employees that work there I'd also understand that sometimes in some Union Enterprises there are work rules that prevent someone from going from a let's say a barista to becoming a manager and and you've indicated that if you will career opportunities for people are enhanced when they're able to move from position to position and become a manager is that a concern of yours no I mean can I tell one story please can uh and it happens to be in the state of Vermont and I think this is indicative of the situation that we are currently experiencing there's seven stores in the state of Vermont that Starbucks has of the seven one of them voted to join a union this is important fact 21 Starbucks People Partners work in that store how many people do you think voted to either become a union or not a union take a guess got me I would have presumed the majority if you hear the number you'll understand the problem 21 people in the store six people voted six four four voted to become a union and two voted for not now I'm not saying why the other people didn't vote that's up to the committee to decide but you can imagine there's issues going on in a store like that where people work close together and influence people to do one thing versus the other but here's the problem since that store since six people voted to to the union of the seven stores in Vermont this particular store have twice the level of attrition and the majority of the people have left the store and the tension that exists in any store that Starbucks has since its individual stores voting in a small group of people there is lots of issues that we are dealing with and overall in the stores that have voted for you in about 300 are twice the level of attrition that we currently have in the 99 of stores that have not voted for the union but the Vermont thing is not a proxy the Vermont thing is exactly what's going on around the country thank you I appreciate that perspective and and would this turn to one other point which is we talk about corporate greed all the time as if it's something brand new of course profit incentive and greed has been there from the beginning of humankind but there's also Union greed greed exists throughout our society through various Enterprises but let me ask your company's highly profitable it was profitable I presume very early on became profitable as time went on where does all that profit go does it go to all pay you and the senior Executives where does the profit go of an Enterprise did it all go out in dividends or stock BuyBacks where has your profit gone over the history of your company the majority of profits that Starbucks has made has gone back into infrastructure roasting plants eight hundred thousand to a million dollars to build a store the profits of the company have gone back to the business now what's most important though is when we create shareholder value as we have for Starbucks Through The Years our employees our partners are sharing our shared success model in that profit because everyone has been an owner and the first day that I came back April 4th 2022 the first day what did I do the one thing that would get shareholders across the country who own Starbucks stock angry with Howard Schultz and that is I stock our buyback program on the first day our stock went down I was not concerned about that and I took that money and I invested it right back into our people which resulted in higher wages one month after I came back now that is the only evidence I have which is the fact that my operating style which has been 40 Years thank you is to build a company that balances profitability with a level of shared success for our people and we have the evidence to prove it sir Murray thank you thank you Mr Schultz for coming before the committee I appreciate it you have listened carefully and throughout your testimony you've made it very clear that Starbucks prefers its workers not to be unionized unionized but I think you know that decision is up to workers under federal law I just have been disappointed I have to tell you from a number of my constituents I've been hearing from about some of the widespread anti-union efforts at Starbucks including in Washington state where the nlrb has certified 19 elections as you know at Starbucks stores they have issued 71 complaints covering 31 unfair Labor practice charges and nlrb judges have issued two decisions now finding that Starbucks violated federal law so let me just ask you a simple question do you agree that it is workers who get to decide whether they want a union Senator Murray I agree that the person at Starbucks has the right under the law to decide whether or not they want to join a union and Starbucks Coffee Company also has the legal right to provide a vision for our employees which currently represent 99 of the 250 000 who wear the green apron that our vision is a preference to maintain our direct relationship and in terms of what you said as I said to Chairman Sanders those are allegations in Starbucks Coffee Company unequivocally has not broken the law employees with dignity and respect which I appreciate but I am hearing from a number of folks really troubling reports about Starbucks refusing to allow credit card tipping cutting employee hours holding the loss of critical benefits like Health Care insurance and gender affirming care over the heads of employees who are trying to exercise their rights and I've even heard reports so you know about uncertainty for Union employees about whether or not they would receive abortion travel benefits which all your workers receive I'm concerned when I hear from my consist constituents about unfair threats of any kind or denying benefits unfairly even when the union agrees to waive its right to bargain I would assume you would agree that that doesn't constitute treating someone with dignity or respect if they are being threatened Senator Murray uh you know you and I have known each other for quite a while you being the center of our home state I think you have many times actually talked about Starbucks as a model employer in many of the meetings that you've had and speeches that you've given I do take offense I have to admit because it's quite personal when you bring up things that you've heard that are not true we have never ever taken any benefit away and we never would of anyone who was interested in joining a union we simply have said that under the law our understanding is we did not have the right to provide incremental benefits during the bargaining process but Howard Schultz the leadership team of Starbucks the board of directors some of whom are here today would never take benefits away of any kind of someone who was involved in trying to join a union well thank you for the answer I'm giving you the question so you have a right to respond that's why I'm asking but you should know that that those are some of the things that I hear and I wanted to hear your response okay and and I've also heard allegations that Starbucks has interfered with employees ability to testify including in Seattle we're we're an administrative law judge found that Starbucks did that can you respond to that chart I have no knowledge of that Senator Murray Senator Cassidy I defer to senator tuberville thank you chairman uh thank you Mr Cassidy uh Mr Jules thank you for being here thank you I know this this is pretty tough at times but uh it's good to hear your side of the story I came from the coaching profession you know for years I talked to young kids every year at the beginning of the year about they all wanted and needed something I always told them one thing only thing you get from me and from this country is an opportunity and you took that opportunity and ran with it and you've got a lot of people that work for you over the years and work for your company and their company and made something that I myself so thank you for that you've you've been a a huge uh Idol for this country in terms of what you've done uh you know we've heard a lot about what you give to your employees health care and all that you know that's probably I fully support unions if people want to join a union that's fine I mean I think that's what this country is about uh sounds like Starbucks employees as a whole what we've heard so far have had a great working environment I understand collective bargaining processes have ongoing with almost 300 individual stores and you have to negotiate with each one of these individuals in each store each individual not each store and I know that there have been difficulties in trying to navigate these individual negotiations I'm sure obstacles have come up that are unique to each store is that correct that is correct sir thank you you want to be respectful as we all do of requests of any employee and you want to make sure that every person or group that you deal with feels that their rights are being respected and their voices heard this could even include employees with specific rights and protections in workplace is that correct that's correct I know this has been a long process that requires considerable effort on your side to do all this so can you speak to me about the difficulties that you've been having in bargaining processes specifically in the unique issues that your average person might not understand yeah thank you very much for that uh when Buffalo uh first emerged and there was a process to try and decide whether or not we were going to negotiate per individual store or by District or region it was the position of the Union to have it one store at a time that created significant complications and obstacles in the collective bargaining process we now have to be put into position to negotiate individual store one by one across the country and set up individual meetings now because in this process store Starbucks managers and district managers have had safety issues in which they Union Union organizers have been at their home they have been outed on social media that have been significant challenges for our people to maintain their personal safety we have said we do not want these meetings to be anything but face to face so we know who's in the room we don't know if there's a zoom meeting of who is taping the meeting who's in the background and who is looking in on the meeting of whether or not they are part of the company part of the union or whatever and so we have asked respectfully we will show up as we have 85 separate times in a face-to-face meeting and we've tried to set up over 365 meetings it is a very difficult scheduling issue and very difficult Logistics issue and we should not be held accountable for not showing up when all we're asking for is face-to-face bargaining thank you I'd like to hear your story about your employee if you'd tell you've got about a minute and a half about about your about the employee that you had the discussion this morning that you had argument about you might want to okay thank you for that yeah when I came back to Starbucks I held about 100 co-creation collaborative meetings across the country to understand from our employees what they were experiencing and the challenges of a post-covet environment on their life at home on their work life work balance Etc those meetings were not about Union negotiations in fact we made it clear we're not here to talk about the union we're here to talk about Starbucks in a meeting in Long Beach a Starbucks partner was trying to interrupt the meeting and start talking about the Union and she happened to be sitting next to me I didn't know she was recording it I didn't know she was filming it but it was clear that there was a disruptive mentality I just turned to her and I said if you don't like the company if you hate the company you could work somewhere else it was not a threat and going back to Chairman Sanders question before I can understand she may have misinterpreted what I said it wasn't a threat I didn't know I was being filmed I just simply said if you hate the company you could go work somewhere else those hundred sessions that I attended are based on what we've done to improve the company to understand the empathy and compassion we need to have for our people in a post-coven environment they were not Union meetings they were meetings to discuss Starbucks and the opportunity for our people thank you for the question thank you Mr Senator Casey Mr chairman thanks very much and thanks for calling hearing Mr Schultz welcome and I want to welcome the workers in this room who have had to do so much extent expend so much effort over many years to have the right to organize and bargain collectively so we stand with you in that effort I think that's a right that every single worker in the United States of America should have the right to to bargain collectively to organize for for wages and benefits and too often in our country workers don't have that right I represent a state where workers over Generations marched and mobilized and literally bled and died for the right to organize it wasn't conferred upon them by some CEO or some some boss they had to fight for it and that resulted of course in the National Labor Relations Act which is still in effect still the law of the land despite repeated corporate attempts to undermine it so we have a lot to talk about not just with regard to Starbucks but for workers generally I wanted to start Mr Schultz with a discussion about one of the firms that Starbucks hired I'm told that when during your tenure as CEO you hired littler Mendelson one of the largest and most notorious union busting firms in the country that reportedly charges upwards of six hundred dollars an hour for their services it's been reported that in 2021 Starbucks shut down all stores in the Buffalo area rented out the Hyatt Regency Hotel flew you Mr Mr Schultz and Starbucks senior Executives into town and forced workers to hear you give anti-union talking points while Starbucks refuses to say how much they've spent on anti-union efforts it's clear the company is willing to spend a significant amount of money on union busting tactics and guess what under current law federal law Internal Revenue Service law Starbucks is able to write off those costs as a run-of-the-mill business expense meaning taxpayers taxpayers are subsidizing union busting in the United States of America including that of Starbucks so Mr Schultz I'd ask you as a private citizen in your personal capacity do you believe that corporations should have the right to get a tax break a taxpayer provided subsidization a tax break for union busting activities uh Senator Casey you've said a number of things I'd like to respond to but we'll just answer that question first no I will I mean Starbucks Coffee Company is following the tax laws and the law that Congress I didn't ask you for about Starbucks I asked you about your personal view yeah do you think that that provision should stay as the law or should be changed my personal view is we should follow the law that Congress has set up do you support that I support the law you support you support the provision that allows allows a company to hire union busting firms and and conduct other activity that interferes with the rights of workers to organize I understand it's the law but you're saying you support it you would not support A change is that correct I support the law and I also take offense with you categorizing me or Starbucks as a union Buster when that is not true well look I you you go to Just March of this year administrative law judge issued a 218 page decision finding quote egregious and widespread misconduct demonstrating a general disregard for the employee's fundamental rights unquote in Buffalo New York so I think there's plenty evidence on the record in terms of what the National Labor Relations Board uh has has set forth in their their opinions and their work let me ask you another question before my time has expired there have been complaints and I want you to answer this if you know anything about it that Starbucks is spying on its workers as they try to organize again another National Labor Relations Board administrative law judge recently wrote that Starbucks used headsets headsets to quote closely supervise Monitor and create the impression that employees union activities are under surveillance so we've heard about this with regard to other companies do you believe and again this is in your personal capacity and you realize where you are now do you believe that workers have should have the basic dignity at work not to be surveilled by their employee employers Senator I am incredibly proud of how we treat Starbucks partners and have since 1987. I understand you're not aware of anyone surveilling anyone you're not aware of that I am not do you support that no I would not support that thank you Mr can I can I come back and just address something you said if you don't mind you talked about Buffalo I just want to clarify from what I understand the activities in Buffalo began in August of 21. I was not the CEO at the time I came back in April of 22. but I want to share with the committee uh what we have found out about the organizing in Buffalo and I think this is important for everyone to know the organizing in Buffalo began with an individual who we later found out was paid for and joined Starbucks an employee in 2020 and even though we hired her on her own Merit we found out that she was paid for by the very Union trying to organize Starbucks [Music] that was a good story we'll come back to that because it sounds like something to do I hope you do I'll defer to Senator Mark Wayne Muller well thank you and considering the chairman doesn't want to hear any of that information because I believe he's pretty biased in his opinion already I'll give you an opportunity to finish up you'll do it quickly thank you very much so as you might imagine uh we're very curious to understand what happened in Buffalo and uh we later found out that this individual which which was hired in 2020 was paid for and under the employment of the Union that was basically trying to organize Starbucks we later found out there was more than one person and so you might want to ask yourself where's the fairness the objectivity and the Integrity of what we are we're talking about here today no and I I mean if you're anti-union as a CEO you're anti-union busting or your four union busting I'm not saying you're anti-union I'm just saying that it seems like to me as a former CEO not nearly at the success that you were at sir and I'm not trying to defend your company because quite frankly politically we're on totally different ends of the spectrum and so the irony of this hearing is actually kind of funny and I do want to point out some hypocrisy about this hearing with the chairman and it's not trying to get personal all this information is going to be very public but the fact that you can't defend your company because you want to have a good relationship with your employees and you believe in employee value which we all do any CEO knows it's success of our companies are based on our employees we get that but it seems like unions today all they want to do is fight with the with the with their their employees or their employer the same employer that is hiring those those team members and that friction causes a a very volatile and and and and and tough workplace and if the company and employees are in the same boat rolling in the same direction then they can't neither one can be successful and and and unions themselves if you're part of a union you can never be an executive you can never be a manager and never be a CEO and if you can't be an executive or a manager or the CEO then how are you actually going to implement the changes that the unions wanting those in those positions to begin with and it seems like they actually hold back their team members but I take offense to to the chairman point out that all CEOs are corrupt because they're millionaires you know if you make a lot of money you're you're corrupt if yet it's it's bothering to me because Mr chairman you yourself have been very successful rightfully so glad you haven't you've been in office for 28 years and your wife has have immersed a wealth of over eight million dollars and and in fact your quote on on on being on being wealthy and being a millionaire was well if you write a bestseller you can be a millionaire too If You Can Be A Millionaire why can't Mr Schultz and other CEOs be millionaires and be honest too if that's the case then why is it that Mr Schultz who actually creates jobs and a bestseller of a book isn't creating any jobs why is it that he's corrupt and you're not why is it that all CEOs are corrupt because they're wealthy and yet our chairman who is wealthy and I'm glad you are you're not guys the government's role is to create an environment for entrepreneurs for go-getters for job for World Changers to be successful in life the U.S government is to Des is designed for people that want to succeed can we can go out and achieve anything that we choose to but when you lean towards socialism what you think is government is the answer and unions are the choice and if you're against us then you're dead wrong and you must be corrupt it's not the world we're living in that's not the America that we believe in and I'm not against unions if you want to choose to be in a union be in a union but if you choose not to then you choose not to and that's why I'm good with right to work states that's honestly why unions actually thrive in Oklahoma and we're right to work states because it creates a happy environment and a good environment because employees get to choose what do we want to be part of and the employer can have a say in it what is wrong with choice what is wrong with employees having a choice what is wrong with the CEO defending his company and openly saying that he is providing good benefits and paying higher than everybody else but yet if you not part of a union you're also paying starvation wages what hypocrisy what bias chairman you're our chair of the health education labor and pension committee we shouldn't have a bias approach we should have what's best for America and all those that want to thrive and work in it and so why we politically disagree Mr Schultz I applaud you for your success and I applaud all the CEOs out there for their success and all the employees that work hard that's in the same boat that's making their companies great thank you thank you thank you well let me respond Mr Senator did mention my name I think and I think you got an all-time record here you made more misstatements in a shorter period of time than I have ever heard please correct well if I'm worth eight million excuse me no public excuse me yeah go ahead all right Excuse me yes sir well I'm worth eight million dollars that's good news to me I'm not aware of it that's a lie all right number two third of public records that's you're probably looking at some phony right wing into net stuff it ain't true no all right you should read beyond that it is not true all right public records no it is not public right okay well you made it not a million on your public record you make it all right excuse me I've got the mic down number two take this step I've got it you had your time okay all right you're not telling the truth second of all you got no evidence that I have ever said that all CEOs are corrupt I have never ever said that probably not believe that you should say that say it furthermore what this hearing is about is whether or not you talk about being pro-union really what this hearing is about is whether workers have the constitutional right to form a union the evidence is overwhelming not from me but for the National Labor Relations Board is the Time After Time After Time despite what Mr Schultz is saying Starbucks has broken the law and has prevented workers from joining unions to collectively bargain for decent wages and benefits Senator Baldwin thank you Mr chairman else I want to begin by acknowledging the leadership role your company has played in providing benefits to workers you talked about it in your testimony with great pride Comprehensive Health benefits to uh full and part-time employees starting in 1988 and stock awards to all employees since uh 1991. you noted uh I think that these benefits allow you to attract and retain a Workforce that you call the secret sauce of the Starbucks success given this history though it is all the more puzzling to me that you're fighting this Union drive so fiercely you've said that a union will sever the direct relationship you have with employees which you call crucial to anticipating their needs instead of leaving it up to your anticipation a union can ensure that you receive clear feedback about what your workers actually need free from fear of retaliation while you call them partners your workers are limited in their ability to engage with you directly because there's a power differential uh and uh you have power over them and the benefits that they cherish a power you have shown your willingness to wield involving employees attempting to organize I I find it um particularly ironic especially given your own powerful story uh That You Don't See this power dynamic I further I think this number is right for your U.S employee base but you employ over 235 000 people in over 3000 in my home state of Wisconsin alone possibly have a direct relationship with all of them some intermediary is necessary if you truly want a direct relationship with your Workforce I would suggest to you that a union can provide that uh I also want to note in your written testimony that you returned to Starbucks in April of last year and noted that the company had gone astray had fallen lost its way on many levels uh you talked about short-termism an issue on which I agree profoundly and who were these Partners to turn to with this direct relationship during this time that the company had gone astray um in Wisconsin I when I met with Starbuck Union organizers it was immediately clear to me that they take significant pride in their work uh you talked a little back and forth about the um quote of hating Starbucks so much why don't you quit or get a job somewhere else these workers don't want to quit they want to work in fact they seem to share so many of the same goals for the company that you've laid out so eloquently in your testimony all of these workers are asking is that you respect their right to organize which would require you to treat them not just as partners but as equals it's a word dynamic that I was talking about so on that note Mr Schultz it has been almost one year since the first Wisconsin store voted to unionize I want to ask you on the record when Starbucks will begin bargaining in Earnest with those workers and when can I expect that I'll hear that the first contract has been signed I love to answer your question I wonder if I can have more time to respond to some of the things you've said but we are prepared in the state of Wisconsin and other states that we have Partners who want to join a union to meet face to face as we stated consistently and begin a bargaining process and we're prepared to do that in Wisconsin Mr chairman I wonder if I could just speak to a few things that the senator had mentioned you have about 50 seconds uh okay uh Starbucks has had almost five million people wear the green apron five million so we've created close to 5 million jobs five million jobs just think about how many families have benefited from Starbucks the majority of those Partners have participated in an equity plan unprecedented American Business 14 of their base pay is how we started in addition to that 99 of the 350 000 who work for Starbucks want a direct relationship with the company in addition to that what's the most important metric of any business and that is trust with your people and as a result of that I'm sorry we have the highest level of retention of any company in our sector that's hundreds of companies the highest level there are time limits here Senator Cassidy I defer to Senator Brown thank you Mr chair ranking member I think this is an interesting discussion because I recently come from the world of building a business over 37 years and I've been clear when it comes to unions they are so important in today's world vis-a-vis large public companies multinationals how would you have any uh countervailing clout unless you didn't have an effective Union I think this is interesting because the restaurant business I think currently has maybe three to four percent of it unionized and one of the reasons since I had a small business for 17 years 15 employees before it grew and the best avoidance of a union is to treat your employees like family pay good wages have good benefits you do that you're probably never going to have a union knocking at your door but we're talking about an industry here that through covid went through one of the most traumatic events any small Enterprise or business has gone through this is not a small Enterprise or business but it's in a business it's got a high fatality rate due to the nature of it I don't know currently what you're paying your average uh employee on the line that's going to be the first question and then what the average pay of senior middle management Senior Management would be I always thought it was good as long as you're earning equity in whatever you're doing that you probably be reasonable there I don't pull in with a Maserati and all of that I'd love to know where you're at on that wage stratification first thank you Senator uh we the the average wage is 17.50 that's higher than the minimum wage of every state in America the with benefits and the majority of our of our people take the benefits that's a twenty seven dollars an hour 65 percent of our managers across the country were Baristas and all in the manager salary is about eighty thousand dollars very good and then do you have a stratum of management above that is a district manager regional manager and I think what we're most proud of is that the majority of people who are managing stores managing districts managing regions started out in our stores we have hundreds maybe thousands of beautiful stories that our partners have shared with us about what Starbucks has done for them and their families as a result of the benefits that we created and those benefits were not created because there was a union those were those were created because of the decisions and I think that's important to note but I think what you represent here is a watershed case because you're large you generally get large because you're successful along the way and we've got to be careful because I'm going to Pivot to something the other side of the aisle is proposed is like the pro act and again I'm probably the most outspoken Republican on the benefit of unions but you you got to be careful where they go if they're going into the gig economy into the independent contractors which is the next chapter on some of this that will stifle entrepreneurialism when you look at if you are large you shouldn't necessarily be held to account unless there are things that you're doing to impede the law in terms of unionizing you've already made that point that you don't think you've been doing it all I'm saying this is important because this will have a ripple effect Way Beyond your business and the one thing we can't have is to suffocate what's made this country great and that is that you do not necessarily have to wrestle with a union if you do all the things that are good for your employees to begin with can you honestly say that you've done that throughout the history of your company in that I know you have Mobility it sounds like several different ways you can grow you have no Mobility unless you're growing as a company but if you honestly done that yes we have certain I wonder if I could just give you one prime example that I think the committee should understand you know during covet as you said the restaurant industry was really plummeted I mean they they we had it very very tough we had thousands of Starbucks stores closed many of our peers started cutting benefits during covet Starbucks did not cut one benefit during covet and we paid every single partner during covet with no exception what was your average wage before covid because you said you're at about 17 now starting did you have to raise it over the last week to raise wages in May that's correct and what was it before about 15 an hour went to Seventeen and one final Point even 17 an hour that's not a living wage in this day and age I'm proud that in our company we pay the highest starting wage in a low unemployment County in any large corporation shouldn't necessarily be bragging about 15 to 20 dollar wages when you look at the typical structure of a large company that should probably be twenty dollars plus like many Main Street businesses pay and I think of companies like yours and the larger companies don't do it you're going to be constantly you know grappling with maybe here but on the other hand you Union shouldn't be trying to get involved in companies that are doing a good job especially Main Street and smaller ones I wish we had more time we'll leave it at that thank you sir Senator Smith thank you Mr chair good afternoon or good morning I think it is still Mr Schultz you repeatedly call your employees Partners do you value your employees or your partners that want to join a union or have joined a union do you value them as much as you value those that have not yet joined a union we have respect for every single partner who wins a green apron regardless of their choice to vote to go for a union so yesterday I had the opportunity to meet with some unionized Starbucks workers from Minnesota Gracie and Elizabeth and they tell me that Starbucks is cutting their weekly hours they estimate that they're losing four dollars an hour in wages because the company won't allow them in unionized stores to access Credit Card tipping when that's available to workers and non-unionized shops and they tell me that they are simultaneously understaffed in their stores and unable to get enough hours to pay their bills if these folks are your partners why are you treating them differently than the non-unionized workers when we raise wages in may we were my understanding was that we under the law we did not have the unilateral right to provide those benefits to Partners who were involved in collective bargaining and that is that is why so you have said that several times during this meeting you've said that you cannot legally provide these benefits without bargaining over them but you know I'm sure that the union has specifically stated in this letter um July 15 20 2022 that they waived any objection uh to bargaining on this it says in the letter to this end the union hereby waves any objection that we might have to Starbucks providing Union represented employees with any wage or benefit improvements provided to unrepresented employees so I don't think this I think I I just think you're wrong let me let me try and explain there are an array of wages and benefits that need to be negotiated in the collective bargaining process it just it would not be proper to take one piece of the puzzle out of the negotiating process since the union the people who have joined the union have decided that they want to negotiate a contract it is out our preference and our right to negotiate that contract fairly and objectively but not in piecemeal so um I think that the way the law reads is that there is an exception to that requirement to negotiate when the employees make it clear and unmistakable waiver to bargaining but let me ask you about this because the first Minnesota store Union was certified over 320 days ago and no meaningful bargaining has happened since then though there have been some meetings do you know how long those meetings have been in Minnesota I'm not involved in any of the meetings so the Minnesota folks tell me that those negotiation sessions have not lasted longer than six minutes so that seems to me sir as a failure to negotiate in good faith when from my understanding in in many of the meetings that we've showed up to have face-to-face meetings the other side has decided to put on a zoom or teams and then we decide and we've told them up front that we will not negotiate unless the meeting is in person and we know who's in the room and so we have left those meetings as a result of the fact that we could not preserve the privacy and the Integrity of a face-to-face meeting so my observation here is that this feels like sort of a catch-22 because you are not willing to bargain on issues like credit card tipping while we are simultaneously you're not coming together to bargain at all and so I think that that is why the employees are feeling who are wanting to be in a union that feel so frustrated but I want to just touch on one other thing I've been listening really closely to you today and um I also come from the private sector had my own company at one time before I moved into the into the public sector and I've been really struck by your focus on what an excellent company you are and honestly it sounds as if you are personally offended or even insulted that anyone would question you or your company and it seems as if you feel that only bad companies should be unionized that there's something nefarious about a company that is done something bad and therefore they need to be unionized and that Starbucks doesn't need a union because you are a good company but I think Mr Schultz that is not your decision to make and I believe that there is an inherent value in coming together to organize that would address this imbalance of power that I think the many many Starbucks sitting behind you and in Minnesota feel I mean you're a billionaire and they are your employees the imbalance of power is Extreme and that is why people want to come together to form a union Senator I agree with you that I do not have the right to decide who can vote for Union or not but I am the chairman I am the CEO of the company and or I was the CEO of the company and I have the preference and the right to communicate to our people about what it is we believe is right for Starbucks and I want to repeat 99 of the 250 000 want a direct relationship with the company the last thing you said and it's been said many times by the chairman I just want to make a point of that this this monarch of billionaire let's just get get at that okay I grew up in federally subsidized how let me finish I grew up in federally subsidized housing my parents never owned a home I came from nothing I thought my entire life was based on the achievement of the American dream yes I have billions of dollars I earned it no one gave it to me and I've shared it constantly people of Starbucks and so anyone who keeps labeling this billionaire thing I don't mean to cut you off we have time limits here and you would well I'm not cutting you off it's your it's your moniker constantly it's unfair no it is not you have had more time I've been generous with the time now I'm sorry but Mr chairman we have a room full of people we have panel to go after you I'm not the only person okay Senator Cassidy defer to Senator Marshall a thank you ranking member thank you chairman Mr Schultz I'm going to change the subject a little bit last year your company decided to close 16 stores Across the Nation including the Stars books down the street here at Union Station due to Rising crime in these cities shortly thereafter you stated that there are going to be many more closures for similar concerns your store managers are quoted saying that their employees have not felt safe amid a spike in crime a surge of assaults thefts and drug use I agree in fact in in fact I fear for my own staff walking home in this neighborhood I feared so much that I purchased each one of them one of these noise makers this past Christmas one of our colleagues office staff was recently violently assaulted as well the lawlessness in this country is out of control when you decided to close those 16 stores because you feared for your employees safety did you then and do you still believe that the white house needs to focus on restoring Law and Order and relaying a message to this country of respect for the brave men and women in law enforcement in this country thank you Senator we do in fact have a significant issue of safety in urban cities around America and Starbucks has closed many many stores that were profitable as a result of the fact that our own people do not feel safe working in the stores and we have a situation of homelessness drugs mental illness and as a result of that in many of the societal issues that we're facing today are difficult for Starbucks to address because we don't have the power or the responsibility to address these things as you've described you know thank you for the um for your answer and your honesty it's a sad day for this nation when the crime is so bad that you feel the need to close profitable shops because you can't keep your employees safe at their place of work and I have to note for the record that every single location you close all 16 of them were in Democrat Rand cities we have another saying I want to change change the subject here again we have a second back home that pigs get fat and Hogs get slaughtered you do have 645 unfair labor cases brought against you based upon the size of the crowd there may be some some smoke and fire together there you this is your chance tell me your side of the story tell me why you have so many complaints do you feel like that there's been a fair negotiation process have you been have you and your company been open to negotiation uh process so this is you know give you a minute here a minute and a half just tell me your side of the story thank you first off with regard to the nlrb senator Cassidy mentioned a number of issues Starbucks coffee company will abide by the law and follow the process I I hope the committee does investigate many of the things that are going on within the nlrb and the the courage of The Whistleblower to come forward with regard to the allegations that she has that she wants to discuss with the committee um this process unfortunately has played out publicly in many different ways and unfortunately a public company in America today is is unfortunately uh guilty before the the before anything so this is your chance yeah so why are you innocent yeah we're innocent because we've done everything that we possibly can to respect the right under the law of our partner's ability to join a union but conversely we have consistently laid out our preference without breaking any law of communicating to our people about what we believe is a vision for the company and when I went to Buffalo even though it was cited before by Senator Casey I never mentioned the word Union once I talked about the vision for Starbucks and the reason is Post covid 95 of the people wearing the green apron had worked for the company less than a year they didn't know anything about Starbucks so I went to Buffalo to share the story of Starbucks what we have done as a company equity in the form of stock auctions Comprehensive Health Insurance all the things that we've done to provide opportunity for our people I didn't go there to talk about the union I went there to lay out our vision for the company and I consistently have done that as well as the leaders of Starbucks we have not broken the law we have simply tried to defend ourselves and tell our employees all of them what we stand for our future the aspirations we have the growth of the company and the opportunity Starbucks is in many ways the quintessential entrepreneurial company of the last 30 years we've created Created five million jobs from a cup of coffee and we've shared the profits with our people and we've done all these things because not because of the Union because of the compassion the empathy and in many ways my own story of understanding what happened to my father and trying to build the kind of company that my father never got a chance to work for and that is the story in Starbucks Senator Murphy thank you very much Mr chairman you know collective bargaining is a fundamentally conservative idea all right we've sort of lost track of that I mean it's rooted in free market principles right the idea that workers should be able to freely join together to negotiate in an free open negotiation with their employer um and so it's kind of disappointing and sad and wild to me at how sort of partisan this debate has become Democrats standing up for unions Republicans saying they support collective bargaining but not seeing that there's Real Genius in the idea in a free market society that workers get to come together um you know it's funny previous Republican candidates um you know they really fought hard to work to win the union vote to speak at Union conventions this sort of new dichotomy we have is in fact new um what do you mean when you say that you abide by the law so I I guess when I do a search online to take a look at um cases that have been brought against Starbucks for illegal firings as you know New York Michigan Pennsylvania Tennessee Kansas Missouri Washington uh decision out of Buffalo requiring you to reinstate workers calling your practice egregious and why calling your practices egregious and widespread and misconduct you say you follow the law but then of course this committee sees repeated evidence of nlrb orders forcing you to reverse actions that were on their face a violation of the law So when you say you don't break the law you abide by law you're you mean you disagree with all of these decisions from the nlrb you think they got it wrong in all of those cases I think what you're talking about is allegations that we look forward to in the process to defend ourselves but if I can give you one specific case these are or but these are but some of these are orders from an early view judges to reinstate employees based upon violations of conduct do you think in all of those cases in which judges have required stores to be reopened or for workers to be reinstated that they just all got it wrong well in in Memphis as in every case so in Memphis as an example uh we we do have I'm not actually looking for I'm not going to be and I'm not looking to litigate each specification I'm just kidding I just just to clarify when you say that you are abiding by the law you mean that in every case in which an elderly judge has ordered you 2 to take steps to remediate actions in every single case they've gotten it wrong we will follow the law and follow the judge's order but we look forward but the judge is making a finding that you have engaged in in in conduct that is not allowed by the underlying law I.E illegal behavior in every case you believe that the judges got it wrong I believe the allegations will prove that Starbucks was correct and I can give you a perfect example if you're willing to listen uh sure I'm willing to I'm willing to okay so let's take Memphis which has been a a clear isolated case but I think indicative of the process safety at Starbucks is critically important we want to protect and preserve the safety of every one of our people in 1997 we had a tragedy in Georgetown where three Starbucks Partners were murdered and so as a result of that we we have always taken safety very seriously but after that everything we do is about partner safety now in Memphis a Starbucks person and who agreed to join the union after hours opened up that store for activities that were not consistent with safety and procedures at Starbucks no one should open up a store that is closed the manager took a disciplinary approach and terminated that person that person was reinstated that is the fact safety is key at Starbucks but we can't be held accountable for things that we believe under the procedures of Starbucks that are based on safety for our people and that is a clear violation of our procedures I I understand I just I'm trying to square your testimony in which you insist that you rigorously follow the law yes with with overwhelming evidence from the organizations that are charged with enforcing American labor law that that is not the case it is akin to someone who has been ticketed for speeding Yeah a hundred times saying I've never violated the law because every single time every single time the cop got it wrong that that would not be a believable contention if someone was to make that before the committee and so um I find it hard to believe your insistence that notwithstanding this extraordinary set of decisions reinstating workers forcing stores to be reopened that you are in fact consistently abiding by the law as your testimony is before this committee I don't believe Starbucks has broken the law all right thank you Senator custody let me just uh make a couple observations relative to what has been said on the other side of the of the aisle of the Diaz first we should have as I mentioned earlier an investigation as the nlrb activities they're being made out as if they're totally objective uh player in all this circumstance but here I have a letter from nlrb confirming that they are the oeoig is investigating allegations of misconduct by the nlrb employees in region 14. now uh we can say oh my gosh nlrb is supposed to be neutral there's tangible evidence that they're not secondly um I'm sorry Senator Murphy left Republicans down here have totally supported the right of people to organize I'll also point out that it was Republicans who were standing up for the trade unions when his first week of his presidency that Joe Biden canceled the Keystone XL pipeline uh canceled it when those trade unions needed those jobs to make their pensions and by the way if I may point out subsequently the Administration has gone hat in hand to Venezuela and the Middle East asking for more production if they had not canceled that pipeline that oil would now be coming down to the state of Louisiana employ more workers in my state refining that way and refining that oil in the most environmentally sensitive way so I kind of Stand by our side Mr Schultz um let's explore a little bit there's this impression that the unionization effort has occurred organically but you mentioned earlier and I think I have some facts here that the person in Buffalo was making sixty nine thousand dollars a year when she went to work for the when she went to work for the store and began to organize I think that's called salting but it wasn't as if there's this organic let's just all come together and unionize um no workers of the World Unite it was no somebody was paid to go in there and create an environment where four out of six people might do it I don't know if that was the four out of six Union any comments upon this person getting paid by the union when she came to your store in an attempt to organize it well if that's not a nefarious act I don't know what is yeah uh it does seem just a little bit inorganic yeah um you made or your company made in a 2023 proxy statement that Starbucks has not been found to have violated the law as part of any enforced order of the nlrb now Senator Murphy suggested that you are guilty because you've been charged and yet you're pointing out that you've not been found to violate the law will you kind of reconcile those two statements that is correct we have not been found guilty of any violation these are allegations we look forward to the process that Congress has set up and two and I think we will Avail ourselves that these will be proven not true now I just made the point I forget if I if I requested this but I would like to enter to the record the letter from nlrb confirming that they are being investigated for nlrb employees uh misconduct in region 14. with objections do you have any comments upon what I feel is to be the politicalization of nlrb from your perspective is that a real thing you know I I don't really have any comment on that I hope the committee will look closely at it okay now there's been a lot made that contracts have not yet been achieved so-called first contracts I have something here from a Bloomberg report that it took um on average 465 days for first contracts in a variety of Industries to be achieved more than a half took more than a full year are to sign it's being argued that you're not negotiating in good faith because you have not yet achieved the contract and yet that seems to be consistent with the pattern of how these first contracts come about is there any statement you'd like to make on that I think that's true as I said earlier we've shown up about 85 times to have a face-to-face meeting we've tried to set up 306 65 additional meetings and we are very clear we're ready and able to have face-to-face negotiations and we will do so at a moment's notice now nlrb's general counsel Jennifer abuso found that you had violated federal labor law by refusing to bargain if some attended over Zoom um I didn't realize it was a law that you had to be able to go over Zoom but any comment upon Mr bruzo who some have found to be an advocate for unions in terms of this particular uh finding you know I think you know I've been in business for many many years face-to-face meetings negotiations collaborative sessions that are all better to be had than anything that is on Zoom is there a law that says that you have to do it over Zoom if one party chooses to go over I've never heard of that Lobster oh okay I haven't heard of it either I yield Senator Hassan I'm happy to yield to Senator Markey for a minute and then I'll follow up after him if that works Center monkey I thank you Mr chairman and uh thank you for this important hearing and Mr Schultz it's a good of you to show up but then again you face little Choice it's disappointing to me that it took such a long time and required the threat of a subpoena for you to appear before this committee and it's frankly disrespectful to your hundreds of thousands of employees but we do appreciate you are finally appearing here all across America workers are saying that they've had enough Rising inequality and outlandish CEO pay for those at the top like you and a paycheck to paycheck subsistence for everyone else the unionizing Starbucks workers are on the front lines as a Groundswell of working and middle-class people while banding together to assert their right to organize Pharma Union and collectively bargain for their dignity my father used to tell me that you can't beg for your rights you have to tell them he lost his finger in an industrial accident as a Young Man there was no OSHA he just said the boss said see you next week Sean back on the job that was before unions that was before rights were put on books and ultimately that's what sidewalk workers are doing workers in Buffalo are the spark that's lit the fire of organizing its locations across the country including 15 Starbucks locations in America in Massachusetts the American people are watching public support for unions hit a record high late last year with 71 percent of Americans approving of labor unions so as you sit here denigrating your workers you're not just morally and legally wrong you're in the minority you're out of touch union busting is disgusting I got the chance this week to meet with Caitlin who is a Starbucks employee from Gardner Massachusetts like you Caitlin cares deeply about Starbucks she originally started working for the company in 2006 and came back to rejoin Starbucks in 2021. when she came back she saw Starbucks similar to how you describe it in your testimony a company that had lost its way she saw her company that now only cared about money at the expense of the health and well-being of its workers so to help save the Starbucks she wants new and loved Caitlyn and her co-workers formed a union they wanted to revive a wayward company make your company better but you vilify Caitlyn and her colleagues for caring you demonize them for participating in their fundamental right to organize and worse you and your company set out to punish Caitlyn and her colleagues withholding benefits and raises cutting hours and purposefully understaffing to harm their most dedicated partners so when you give us 10 pages of testimony extolling the benefits that Starbucks offers its employees that's not what I see I see Caitlyn I see you squeezing the people who have made you rich with blatant disregard for the law perhaps because you think if you can hire the lawyers and pay the union busting consulting firms you can get away with violating other people's rights with disregarding their dignity and with silencing working people in America but here's the thing if you can pay the lawyers and the consultants and the pr Specialists you can also pay the workers a fair wage so you say that your father was unfairly fired after he was injured on the job your father had no rights and your family paid the price that is how your workers now feel they have no rights they don't want to be like your father who had no rights they don't want their families to have to pay the price for their children the way your father had to pay a price but his children they want rights your father couldn't protect himself that's all your workers are looking for so they can protect themselves and their families so that what happened to your family does not happen to their family I don't think you understand that Mr Schultz they're just looking to be someone who can protect themselves in the way your father could not so Mr Schultz I would just hope that you would understand that but I'm afraid you don't I'm afraid that if you step down as CEO that you don't understand that these people are afraid that your company will lose its way again and that they need rights that don't just come from you but come from the company that's what they're looking for it lost its way you say you're back but it could lose its way again workers should not be dependent upon you Mr Schultz and your sense of right and wrong they should be able to have laws protections unions that stand up for them every single day of the year and that is something I think Mr Schultz that you just fundamentally don't understand these workers are just like your father and they have no rights can I respond sir 30 seconds only 30 seconds I need more time for that but I'm sorry let's open up myself every member here my father you don't understand sir my father was a World War II veteran fought for this country in the South Pacific you don't understand I understand completely your father was can I finish her yes sure yeah your father served our country and then the company he worked for can I respond chairman yes absolutely okay I don't understand let me ask you a question since you cited the Union as the answer is there a Union contract that you personally are aware of that provides Comprehensive Health Insurance equity in the form of stock option free college tuition is there at 17.50 on an average of twenty seven dollars with benefits are you aware of a Union contract sir answer the question of a Union contract that has those benefits Sir Mr Schultz are you aware Mr Schultz here's your testimony looking back looking back it is clear to prior to my return last April the company had lost its way that it had fallen under the dangerous influence of walls that I had always tried to ask you a question sir you don't understand your testimony says that your own company lost its way and it will lose its way again unless it is Mr Schultz Mr Schultz Senator Hassan please you don't know thank you Mr chairman and I want to thank you for holding this hearing today to discuss reports of illegal union busting at Starbucks locations across the country so in New England alone there are 19 unionized Starbucks stores and a total of eight unfair Labor practice violations have been filed by the workers union so it is absolutely critical that we hold companies accountable when they fail to comply with federal labor law Mr Schultz I am seriously concerned by reports that Starbucks is coercing and retaliating against workers for exercising their rights to organize for example by unjustly firing workers who are involved in Union organizing conducting surveillance of Union organizers and reducing their work hours until two weeks ago you were the CEO of Starbucks and you continue to be a member of the board of directors as well as a major shareholder so what I want to know is this I know that Senator Casey asked you about reports that Starbucks was surveilling workers who were engaged in organizing uh did do you have any knowledge that such surveillance took place I had no knowledge of that sir who decided to move these workers to other locations the workers who were engaged in organizing or to reduce their hours or fire them I'm unaware of that so you had no participation in decisions about moving workers who were engaged in organizing I had no involvement in any specific issue that regards the Union in a district or a store no were you or your successor involved in any of these decisions I'm just asking again no no Mr Schultz National Labor National Labor Relations Board has filed over 80 complaints against Starbucks for this kind of activity that I just asked you about Starbucks leadership really needs to end these practices you've said you don't know anything about them you've also as you discussed with Senator Markey indicated in the past that you came back because you felt the store the company had lost its way so I will just add my um a my concern about these reports of these activities and urge you as a board member to take action to make sure that the rights of workers who are engaged in organizing activity are protected now as you know the National Labor Relations Act requires an employer to bargain collectively with its employees union Representatives it has been more than 450 days since the first Starbucks Union was established yet there has been little evidence of good faith negotiations between Starbucks and its Union the delay is truly unacceptable as CEO of Starbucks what exactly did you do to move Union negotiations along in a timely way we said consistently Senator that we are prepared to have and to have collective bargaining sessions when they are face to face and we are ready willing and able well the record to date is unacceptable 450 days what will you do as someone who continues to serve on the company's board of directors to remedy the situation we want to have we want to have these meetings we've scheduled 85. we've been to 85. we've tried to schedule 365 and we're ready to do that and my understanding is that um on multiple occasions after you schedule them the company cancels them at the last minute and I would suggest to you that that is not acceptable the facts really do speak for themselves on this issue Starbucks is an outlier here so you need to quickly shift course and negotiate with your unionized workers um earlier this month this committee heard from labor leaders about employers across the country who partner with unions to achieve better outcomes for their companies and the economy for example the president of the teamsters spoke about how they've partnered with United Airlines to build out an apprenticeship program that would create a thousand good paying middle class jobs knowing that other large companies successfully collaborate with unions why has Starbucks not done more to collaborate with its workers unions I don't think that's true well failing to reach a contract over 450 this time period between requests to organize and getting contracts done indicates that you are resisting unionization as opposed to working with the union and then collaborating with it Senator we respect the right of every person who wears a green apron if they want to join a union but we also have the right to communicate to the 99 350 000 people who want a direct relationship with the company so my question is why not work with the union and collaborate and why not get the input from the unions to actually improve things for workers well we've we've sat down 85 times to have those meetings and we hope to have some more so again I will just urge you there are lots of examples of large employers who work well with their unions and they actually find that their business does better when they negotiate with unions reach contracts and collaborate with those unions so I would urge you to take that approach thank you Mr chair Senator Lujan thank you Mr chairman um Mr Schultz thank you for for being here today I have a series of questions some of them are yes or no's and I hope to be able to cover a lot of ground here if it's possible Mr Schultz yes or no does Starbucks provide employees with generous benefits like Health Care paid parental leave and college scholarships yes and you're proud that Starbucks does a very proud I understand that part-time employees need to work at least 240 hours over the course of three consecutive months or roughly 20 hours a week to be eligible for those benefits is that true I'm not sure that's correct sir I have to get back to you I don't think that's correct I don't want to ask one of your lawyers I believe that to be true okay um I see a lot of head nodding from employees behind you but nonetheless we can I can submit a question to the record so that you can definitively say yes or no to that Mr Schultz what happens if workers hours fall below a threshold as I suggested are you able to answer that question to their benefits I think their their benefits would be in question and the manager would try and get their schedule up so they don't lose their benefits so I understand that Starbucks has a widespread pattern of reducing worker hours in stores that have unionized after conversations with constituents from New Mexico that's what I've learned and why does Starbucks reduce workers hours at unionized stores that's good I'm not aware we do that sir no no Mr Schultz you announced in May 2022 that the company would raise pay and double training hours at its more than ten thousand corporate owned stores but you said that these changes and others would not apply to unionized stores or stores where workers had filed for Union elections Mr Schultz yes or no did you say this yes my understanding was that we were not allowed under the law to provide benefits unilaterally to stores and partners that were involved in unions was there a finding at the end at nlrb along these lines as well I'm unaware of that related to that statement uh I'm unaware of that and yes or no do you claim that Starbucks cannot make changes to benefits without good faith collective bargaining that is my understanding the National Labor Relations Board requires an employer in the union to bargain in good faith about wages hours and other terms of employment until they agree on a labor contract not after are you familiar with that yes and yes or no just so that I understand correctly is it true that Starbucks can hold shareholder meetings virtually but it refuses to allow some union members to join bargaining negotiations virtually even if other members are present that's correct the reason that I asked the question about the reduction in hours Mr Schultz is I certainly commend and appreciate what decisions were made about respecting employees about valuing employees as well what concerns me is practices that have been shared with me were a reduction in hours where an employee maybe once worked full-time 36 hours or so but then hours were changed at that property for whatever reasons I'll suggest that I believe it's because of unionization and look forward to getting your response there but then the employees I'm told have to be on call or made available if Starbucks decides to add a shift or something is that true sir I'm unaware of a specific store or situation in New Mexico I'm sorry I'm not asking about a specific store Starbucks across the country in many properties has reduced hours of employees that's a fact is that correct for union workers for anyone they've reduced hours we adjust the schedule based on our business when someone hours are reduced if it's for business does Starbucks have a policy where that employee has to make themselves available the Starbucks decides to call them back in for a shift that they're not scheduled for uh your head not indicates a yes I believe yeah let me try and answer that the the manager and the assistant manager works very closely with the people in the store to adjust hours to accommodate people's work-life balance as much as we possibly can okay well that's not my understanding I'd be happy to submit something into the record my concern is this if if a store changes its hours reduces its open hours staffs schedules are changed they reduced from 36 hours to 20 hours but they're told to they need to stay available well how do they get another job if they can't get another job and they're trying to go to school or do something to to to to broaden whatever they're doing in their lives but then a policy is put in place and says no we're going to reduce your hours and you have to stay on call whether it's a manager or not that's a Starbucks policy I just hope with all of this that's not a policy Well we'd be happy to pull you in to visit with folks from New Mexico um and uh and review some of those areas as well that I've been taught from from others so I look forward to that as well but I hope that can be done here in all of this with look there's a lot of interest there's cameras outside and all the rest Mr Schultz this company started in a strong way with what it did with its anchor stores out in Seattle and around Washington you know there's an old RB case where they got closed and there's allegations that they've got to open up again I don't know and they're being appealed so I don't want to get into all of that stuff but going to what Mr Markey said with testimony that we lost our way we want to be here when the panel I certainly hope that we can find that way back because a lot of folks support Starbucks because the employees were treated well and I just hope that that's something that we can work on together but I look forward to following up with your staff thank you Mr chairman then I'm incredibly proud of the long-term track record Mr chairman if I can't speak any longer I didn't ask a question to Mr Schultz I'd be happy to ask a question if you'd like a response okay thank you thank you very much senator uh what we're going to do is we have a wonderful panel that's going to be up here in a second uh you have not voted yet and I have not voted yet but yeah just for 30 seconds can I be recognized to submit a letter into the record from the Albuquerque store without objection let me conclude this um session with Mr Schultz in saying that we are looking at a situation where one side because all the money has all the power as all the Consultants can hire and fire at will looking at another side where workers are making not very good wages wages that were forced up as I understand it by the threat of unionization so that you now have a 15 an hour minimum wage we're looking at a situation that Senator Lujan just mentioned you know it was in a lovely room here there's one world out there in the real world whether it's Seattle or Vermont or wherever it is people are given arbitrary schedules as to when they can and cannot get to work sometimes the working 20 hours a week sometimes they're working 30 hours a week hard to build a budget around that but at the end of the day this hearing is not about my best-selling book it's not about Venezuela and it's a good book people should read it but it's but the issue is pretty simple workers have a right to join a union in hundreds of shops that you control workers have voted to join a union there is zero zero Union contracts what I am not only asking you I am urging you is do not only the right thing do what is legal sit down now you've said you're prepared to sit down face to face is that what I heard yes do it sit down in the next two weeks come back to us and tell us tell us the success that you've had in finally negotiating a first contract that is my hope and with that do I get to say a state you do yes and I would also say this hearing is about how we should have a neutral process by which nlrb is making not a thumb on the scale on the side of one side or the other but in which they are attempting to have a neutral process and this committee should be investigating the allegations that have that we have a confirmation that oig is investigating that there are nlrb employees who are doing precisely that now we on this side of the aisle firmly defend the ability of people to unionize and we have promoted policies much more favorable for unions for example Keystone XL pipeline and it absolutely has to do with the administration's desire to buy oil from Venezuela than from Canada why in the world that would be I don't know and employing American workers and American Trade unions why that would be I don't know but nonetheless that's their call that's not mine uh but we should not in this committee presume that someone is guilty before we have done our own independent evaluation particularly because it would depend upon an evaluation by nlrb which we happen to know right now is in under investigation for being biased NLB is not under investigation for anything all right with that their employees are their employees thank you very much for being with us uh we are going to recess for uh 10 minutes and then we're going to have a very excellent panel joining us thank you thank you foreign questions thank you everybody thank you foreign that's fine yes foreign never got something okay foreign foreign oh my God uh sure I guess so did you foreign vote that we had to cast um we are now going to begin the second panel and we're delighted to have an excellent panel which will include Maggie Carter Jason Saxton Sharon block Bradley Byrne and Rachel grisler our first witness is Maggie Carter Miss Carter began working at Starbucks part-time four years ago to get health benefits and pay while attending University of Tennessee our store in Knoxville Tennessee was the first Starbucks store in the South to unionize and since then Ms carta's help workers at numerous other stores organized and I'm delighted to have her here to talk about her experience Miss Carter thanks for being with us turn the mic on and thank you so much Mr chairman you're welcome so my name is Maggie Carter and I'm a single mom to a beautiful eight-year-old boy named Colson being his mom is the absolute greatest gift of my life he's why I ended up at Starbucks the only place to offer me part-time benefits and what I thought would be flexible scheduling while in school as a lesbian I was also drawn to Starbucks by its reputation as a progressive employer I started working at Starbucks in Jackson Tennessee in May of 2019. I was paid eight dollars and 35 cents an hour then March of 2020 came and it felt as if the world shut down just not at Starbucks I worked consistently from day one as the of the pandemic because as a single mom I didn't have a choice in April 2020 I told my manager I needed to move from Jackson to Knoxville it wasn't until two months later she responded telling me I had only 48 hours to decide between quitting and being rehired in Knoxville losing all of my seniority and benefits or taking a leave of absence without pay and crossing my fingers to see if I would be transferred to a Knoxville store because of kovid the company had Frozen the normally easy transfer process I couldn't risk losing my benefits so I chose the second option but it meant that I went without pay for three months luckily I was able to Begin work at a Knoxville store in August 2020. the whole situation was a punch to the gut and the emotional impact of the disrespect I felt ultimately contributed to my belief and the need to organize a union in October of 2021 Starbucks announced that starting pay would increase to 15 an hour almost a year later I scoured the internet searching Starbucks wages benefits pay increases and I learned about Starbucks workers organizing I shared this information with my co-workers and we decided to stand together to file for an election on Christmas Eve we were proud to be the first store in the south but it wasn't without an epic fight because Starbucks resisted us every step of the way just five days after announcing our Union Drive our regional director drove to our store from out of state and was working alongside my partners attempting to make drinks it's the first time in my entire time with the company that I've met a regional director in person Partners suddenly started getting disciplined for minor dress code violations or being five or so minutes late every day it felt as if there was a concerted effort to build a case against Partners who showed even the smallest bit of support for the Union days prior to ballots being mailed out for the election managers closed our store for hour long periods most during Peak operating times to hold impromptu captive audience meetings it felt like the company was suddenly paying full attention to us and were willing to throw absolutely anything at us to deter us from organizing we won our vote one year ago today March 29 2022. since then we've made every attempt to try to bargain in good faith with the company Starbucks walked out on our store's only scheduled bargaining session after just 30 minutes on May 3rd the company announced that Partners who were organizing or had already unionized would not receive a series of important benefit increases that non-union stores would be granted my partners along with thousands of Partners across the country still do not have access to these benefits nor do we have a company that is willing to sit across the table with us and bargain for them this is part of my store's campaign story but if you look to the 7 500 Plus members of Starbucks Workers United you will find thousands of stories that detail similar or more grotesque accounts of Starbucks behavior during their scorched Earth union busting campaign my co-worker Michelle Eisen stated it perfectly when she testified before the house it should not take an act of Bravery to ensure you have a voice at work dated laws allow so much room for companies to harshly assert themselves unequal resources combined with unpal unbalanced power dynamics ensure that the company's voice will often be louder than the collective voice of workers Schultz has made a career selling the idea of offering benefits to part-time workers because he wanted to operate a different kind of company I'm a single mother working tirelessly for this company for four years and I'm certainly not alone in feeling nothing but left behind during a time where everything we knew about the world was uncertain you cannot be Pro partner and anti-union it's well past time for the company to bargain in good faith help us hold them accountable thank you for allowing Partners to have a seat at this table alongside former CEO Howard Schultz because that is significantly more than he was willing to offer to Starbucks new CEO laxman Nar simhan you have an opportunity to chart a different course to truly make Starbucks the different kind of company Schultz promise but failed epically to produce this is a chance for your company to stop its unprecedented campaign of Union busing and instead partner with us your so-called partners and and our Union to build a company that truly lives up to its stated Progressive values thank you so much thank you Miss Carter our next witness is Jason Saxton who is a former Starbucks shift supervisor Mr Saxon slaughtered working at Starbucks in Augusta Georgia in 2019 he and his co-workers successfully unionized their store in April 2022 and in July 22 after a two-day strike he was illegally fired by Starbucks uh Mr Saxon thanks very much for being with us thank you chairman Sanders my name is Jason Saxon I am a wrongfully fired Starbucks worker from Augusta Georgia I started with a company in 2019 I hired on as a chef supervisor in time I became the go-to not only for Baristas but management as well I was recognized for my dedication and hard work as well as the positive and infectious energy and environment I created for partners and customers I even won partner of the quarter my time at Starbucks wasn't all bad I met my amazing wife who is now the mother of our two-year-old Ava I got to be there for the customers who relied on US during the pandemic and support my co-workers whose families were also going through some really tough times being a disabled veteran with osteoarthritis of the spine from my time in the Coast Guard I felt it was my duty to serve my country again in order to make my workplace more Equitable but also so that my work family could have what they needed to survive we Face many failed and broken systems working at Starbucks when we when we began to organize a union we saw that Starbucks had failed at honoring its State admission value so we chose to live up to them in challenging the status quo in late 2021 when we started to hear about Starbucks workers in Buffalo organizing a union I thought we need this too I reached out to Starbucks Workers United to see how we could get started organizing in our store and began talking to my co-workers we kept organizing despite increasing retaliation and surveillance the company sent higher up managers to our store and it felt like it was just to surveil us the regional director who drove down from Atlanta was in our store regularly with the district manager we were disciplined for minor things that happened in the store like being written up for being two minutes late which had never happened before terminations increased too a partner who experienced sexual harassment from one of our managers was terminated after reporting it they held captive audience meetings they called them one-on-ones for us to have all of the facts but the partners were outnumbered every time in these meetings Partners were being threatened with losing their benefits if they joined the union which made them feel intimidated and scared in February 2022 we heard about the Memphis 7 a high profile case of retaliation and termination against a group of mostly workers of color they're firing had a chilling effect on me and my co-workers as we saw the company betraying the very values and Mission that these Memphis workers were upholding despite our fears we were inspired by the courage and power of the Memphis seven and filed for our election a month later in March 2022 a week after we filed they replaced a sympathetic store manager but it backfired as more people got on board with the Union in April our store won our election by a landslide 26 to 5. despite all of the threats and intimidation Starbucks retaliation and union busting ramped up even more after we won our election we were constantly being watched and managers listened in on our conversations through our headsets store hours were constantly changing and hours kept getting cut people were fired right on the shop floor they fired seven of our union members two of them were shift supervisors two partners requested medical and maternity leave management refused to sign off on their leave and they were terminated several people quit including my wife some of us were told that we should look for another job in July I've led a two-day unfair Labor practice strike and delivered our demands a month later I was fired for supposedly being disruptive I did not receive any write-up or discipline and there was no investigation I was fired after organizing like so many union leaders across the country I have filed an unfair Labor practice charge with the nlrb seeking to be reinstated at Starbucks Starbucks and big corporations have a lot of power and money and they are willing to pull out all the stops to die to deny workers a voice and a seat at the table in a union that's why I'm thrilled to be here today to have witnessed firsthand Howard Schultz being held to account for his company's illegal Behavior we are coming together to demand better pay affordable health coverage and stronger safety procedures I'm proud to be a leader of this new labor movement we're taking on corporate power and fighting for all of us one day my daughter is going to be able to look up her dad on the internet and find out that I fought for a better future for every Starbucks worker and for all working people and I know she'll also read that we took on one of the most powerful corporations and won that's why I keep fighting and that makes everything worth it Mr Saxon thank you very much our third witness is Sharon block a professor of practice and the executive director of the center for labor and adjust economy at Harvard Law School for 20 years she has held key labor policy positions across the legislative and executive branches of federal government including here at the help committee and in the nlrd MS block thanks so much for being with us thank you chairman Sanders ranking member Cassidy for inviting me to testify today it feels a little bit like coming home I want to make clear that first that I'm testifying in my personal capacity and not as a representative of Harvard Law School in light of my long service with the nlrb I'd like to start my testimony by recognizing the great work done by the nlrb career staff with regard to the Starbucks campaign handling hundreds of cases over the past 18 months I know them firsthand to be consummate professionals and dedicated public servants next I'd like to address the purpose of the National Labor Relations Act so that we understand the consequences when an employer denies workers the rights guaranteed by the act the nlra does not guarantee that workers will be represented by a union or that if they are so represented that they will secure particular outcomes at the bargaining table instead it guarantees to them a fair process to decide for themselves whether they want to exercise these rights it is always the workers who make these decisions it is not the employer's decision so thought of in this way you you can say that the nlra establishes the rule of law for the workplace and so the question for this hearing is whether Starbucks respected this workplace rule of law or has undermined the ability of workers to be treated fairly in their quest to decide for themselves whether they want Union representation I'd like to make three main points in the remainder of my testimony first the scope of Starbucks violations alleged and found so far is beyond the scope of the anti-union campaigns that I have witnessed during my career as a labor lawyer second these violations should not be understood as isolated acts but rather should be viewed as a coordinated campaign to stifle Union activity across the company finally it is critical that this kind of egregious conduct is taken seriously because otherwise it will send a message to workers across the economy that their rights are as disposable as a paper Starbucks cup first I'll address the scope of the violations as you have heard already Starbucks is facing more than 500 allegations that it has violated the nlra an already career board agents have found Merit in more than half of those charges in addition four board members from both political parties and seven career administrative law judges have concluded that Starbucks has committed violations of the ACT while it sadly has become quite common for companies to respond hostily and often unlawfully to organizing campaigns by their workers I'm not aware of another company in recent years that has had this many allegations leveled against it or this many allegations found to have Merit the egregiousness of many of the violations also makes this campaign stand out for decades board law has deemed the firing of pro-union workers during an organizing campaign as a Hallmark violation that is a violation that is likely to have significant impact not just on the worker who is fired but also on the organizing rights of co-workers already The General Counsel and aljs have found more than 20 Starbucks employees have been fired because of their Union activity these discharges and other Hallmark violations found is conduct that goes to the very heart of workers rights under the act and in the words of the alj who reviewed Starbucks anti-union campaign in Buffalo Starbucks has engaged in egregious and widespread misconduct demonstrating a general disregard for employees fundamental rights that observation leads to my second Point what has happened at Starbucks is not just a collection of individual violations it looks more like a company campaign to stop the workers campaign in its tracks each time the company commits a new violation in a new location or at a new stage in the Union's campaign it is communicating to all of its workers that the rights accorded to them by the law can be defeated that the company is the resources the will and the stamina to undermine the exercise of their rights at every turn therefore I'm also concerned about the wider message that Starbucks vast anti-union campaign sends workers across the country especially low-wage workers have also been inspired by what the Starbucks Baristas have achieved over the past 18 months but what do these workers and the public think when they see that Starbucks is willing to break the law that protects these rights hundreds of times I commend the committee for holding this hearing to show that you take seriously workers rights to organize and to sit at a bargaining table if they choose even if their employer is a huge company that really doesn't want them to have a union it's a Bedrock of our democracy that the law applies to everyone including the most powerful so I believe that much is at stake in ensuring that Starbucks workers rights to unionize are protected and respected thank you for your time thank you Miss Mark um Senator Cassidy is voting so I'm going to introduce his Witnesses a former representative Bradley Byrne served four terms in Congress and has more than 30 years of experience as a labor and employment attorney in private practice uh Mr burn thanks for being with us thank you Senator Sanders and I appreciate the opportunity to be here I've submitted a written statement I won't read that to you I do not represent Starbucks I do not have a position about whether they have or have not committed unfair Labor practice violations I do not have a position on whether they should or should not be organized I believe that it's up to the workers and I trust the wisdom of the workers at the Starbucks stores to make those decisions inappropriately conducted elections I'm here because I represent a whistleblower a longtime employee professional employee at the National Labor Relations Board who has come forward to the Inspector General of the National Labor Relations Board with information that there have been significant irregularities violations of the neutrality of the organization of the agency during at least one such election now why does that matter the process that we follow in these elections is very important because as the previous speaker said it's to make sure that the employees make a free and uncoerced decision it's not to protect the management of the company it's not to protect the union and it's certainly not to protect the nlrb the nlrb is required to conduct what we call laboratory conditions from the time a petition is filed until the time you have an election that means you've got to make sure that the the voting environment is free that isn't any coercion and most especially in this case that the nlrb isn't putting its finger down on one side or the other they shouldn't favor the employer they shouldn't favor the union they should be professional and neutral in all cases and in my experience the vast majority of the employees then RB do exactly that unfortunately we know that at least in at least one case that that was violated it was violated egregiously and a hearing officer found four different violations now here's the problem with all that if you do something that challenges the Integrity of the process you've challenged the Integrity of the vote and if you challenge the Integrity of the vote you've you've challenged the Integrity of the entire system because remember it's there to give the employees the final decision not the company and certainly not the Union so what I would like for this committee to do is to use its oversight Authority which is considerable to look into what happened not just in this one case but to determine if there is a pattern in practice at the nlrb of violating their neutrality obligation and if there is a pattern of practice is that pattern practice being directed from people in higher echelons of agency I am very concerned by public statements public positions taken by the general counsel of nlrb the general counsel is a political appointee there's nothing wrong with that that's true when you have Republican presidents just like it's true when you have a Democrat president but whether you're a democratic appointed nlrb general counsel or republican appointed you have an obligation to maintain that neutrality you have an obligation to follow the law what this general counsel has done is attack the process for elections altogether she wants to do away with elections that greatly disturbs me it flies in the face of long-settle law and it also flies in the face of what I've been hearing a lot about recently and that is workplace democracy Workforce democracy well if we believe in workplace democracy we ought to give employees the right to vote as to whether or not they want a union if they do as they have done in some of these Starbucks elections That's the Law they get to have a union represent them but in many cases they vote no and the vast majority of cases where I represent an employer representation election the the employee chose not to have a union represent them fine whichever way they vote is good but they ought to have the right to hear both sides of the story which they won't have if they don't have an election and they ought to have the ability to walk into a secret place and cast a secret vote so that no one is coercing them to vote whichever way they want to vote so I asked this committee and the Congress to look at this very carefully because of the seriousness of the situation it should be all of our concern that we make sure that we have true Integrity in these elections so that the result is final and fair I thank you for the opportunity to be here and look forward to your questions um Mr burn thank you very much Rachel grsler is a senior research fellow in economics at the Heritage Foundation she previously served as a senior Economist that joint economic Committee of Congress Ms Russell thanks very much for being with us is your mic on yes okay hold it closely thank you for the opportunity to be here today first I want to recognize the important role that unions have played in U.S history in securing an important worker safety protections just wages and giving workers a previously unheard voice many of the things that unions fought for are now protected by law and the globally competitive economy has empowered individual workers and ultimately weakened Union's advantages for example when the only cars that Americans could buy were those that were produced in the U.S the United Auto Workers Union could impose above Market competition compensation while that benefited union workers in the short run it meant more expensive cars fewer people to able to afford them and fewer workers needed to produce them when foreign competition entered and unions maintained their excessive compensation demands automakers began shuttering their doors in domestic auto correction today is one-third of what it used to be two decades ago in addition to shifting to more service oriented jobs American workers have become more educated and more mobile the average worker changes jobs 12 times throughout their career which means pensions built on Decades of service are less desirable in rigid pay scales may work for nine to five jobs where everybody produces 20 widgets a day but a few jobs today are so routine and most workers want to be paid based on what they contribute consequently Union advantages have been waning since 2007 non-union wages have increased 56 percent while union wages have increased only 41 percent and Union pensions have recklessly promised 677 billion dollars and pension benefits that they haven't set aside to pay instead of adapting to provide new services at workers value unions have turned to political force in inciting animosity depicting company management is 12-foot diseased rats is dehumanizing and destructive most people want to be part of a team not a battle in fact positive workplace relationships are the biggest indicator of employee satisfaction most people also don't want their money taken to pay for things that they don't value but many unions spend more money on politics than they do representing workers a recent study found that only 16 percent of teachers union dues go to the Local Union that Bargains On Their behalf the rest goes to the state and the national unions that spend a lot of that money on politics unionization hit an all-time low of 10.1 percent last year and in part that's because employers can be more responsive and accommodating to workers desires without a union dictating what they can and can't do instead of wooing workers unions are trying to forcibly reverse their decline through laws that would take away workers privacy their secret ballot elections their right to work without paying a union and the ability to be their own boss but instead of forcing workers into one size fits all unions alternative worker organizations could benefit more workers for example Major League Sports bargain collectively for some things but players are able to negotiate their own salaries professional organizations like the Freelancers Union provide Educational Services and they bring workers together to pool benefits in worker Choice models would allow more workers who want to be in a union to have that option while not forcing anybody who doesn't want to be in the Union the employees right act would secure fundamental rights like privacy secret ballot elections it would Elevate the voices of in the opportunities of Union and non-union workers alike and it would also protect the livelihoods of 59 million Americans who participate in independent work it would also preserve the small business franchise model the recent shortage of workers in a longer term decline in labor force participation is troubling for the economy and Civil Society to help more people find meaningful and productive work policy makers should expand apprenticeship opportunities enable more portable benefits and end unnecessary regulations that prevent employers from offering more flexible and generous benefits additionally it is the nlrb's job not congresses to investigate unfair labor practices and to render consistent and impartial decisions it's also the nlrb's job to oversee Fair elections and to protect workers and employers Free Speech rights I don't know about specific unfair Labor practice charges at Starbucks or any of the roughly 18 000 unfair labor practices filed with the nlrb last year but I do know from my work advocating for workplace flexibility that Starbucks has been a leader in expanding benefits like paid family leave and providing College tuition and high starting wages the fact that their turnover rate is less than half the industry average suggests that they're doing something right running a business and attracting and retaining workers isn't easy and employers shouldn't have to fear Congressional harassment if they don't want a union coming between them and their workers thank you thank you very much let me begin my questioning with Ms Cotter and Mr Saxton uh you have heard I suspect Mr Schultz saying that he obeys the law um he respects the right of workers to organize if that is what he wants Starbucks does not engage in union busting uh Miss Carter what is your observation about that my observation is that that is not my experience while working in a store that was unionizing um thank you for your question chairman so you know we were forced to go through multiple captive audience meetings in our store and our store was the only one to stay open throughout the entirety of the pandemic unfortunately because of a captive audience meeting a member of management who traveled to our store from I don't know where I had never met them before gave multiple partners covid in this meeting and we had to shut down for five days now that's a little bit of union busting and outside experiences but kind of uh crazy workers have any option about whether or not they would undergo this meeting with the uh Starbucks executive we were scheduled for that meeting and and it actually was our very first one so we weren't told at this point in time that we didn't have to attend so it was very much not an option okay let me get to Mr Saxton um you heard what Mr Schultz said what do you think thank you for your question Senator um that hasn't been my experience in my store we when we filed they fired our store manager we he was a very well liked star manager he actually helped in our organizing effort once he was fired after that you know they brought in a interim store manager and a store manager team to make our store more efficient that making our store more efficient resulted in us constantly coming into work with everything moved around so every single day we had to relearn where everything was with that uh the interim store manager would take notes about what she would hear or see on the floor and she'd write down Partners names we didn't find out until after we had our election that those people that her the names that she had written down were going to be written up and or fired so I I what I'm hearing from you is you didn't quite accept Mr Schultz's view that he was not engaged in anti-union activity they have definitely engaged in anti-union activity let me get to this block um if I heard you correctly I think you indicated it what you were seeing at Starbucks is unprecedented and that in modern history and that what Starbucks is doing is also sending a signal to the corporate world that in a sense if they can get away with this other corporations can as well am I right on that yes I think that that's a fair interpretation of how this campaign may be perceived and in my mind most importantly among other low-wage workers that work for large corporations that have the resources to um to engage in this kind of drawn out long litigation over um their activity during an organizing campaign what is the purpose do you think of these long never-ending uh uh efforts on the part of companies why do they do that I mean I try not to speculate on other people's motives but um you know I am concerned that we are seeing now fewer petitions being filed by other Starbucks employees there can be lots of reasons for that so I think you know we at time will tell but you know as as other Witnesses and and as other members of the committee have indicated there is necessarily a huge power imbalance between workers and the company and so there's this ability to play things out over a long time just exacerbates that kind of power and balance okay assembly Cassidy thank you Mr chairman uh Mr Byrne um you representing constituents of mine who's bravely provided information to the nlrb Inspector General of misconduct that she witnessed during the representation election at a Starbucks in Overland Kansas and specifically a hearing officer found there was substantial disparity between the communications the Region's shared with Starbucks and the communications the region shared with the Union um what makes this an issue well you're supposed to be neutral and so if you're having Communications with the Union about an issue you need to have communications with management as well and if you're not having that even communication then clearly you're favoring one side over the other now some of the communications seem to me fairly benign but again I'm not a lawyer but but I gather it has to be even Keel whatever you do for one you have to do for the other that's correct so one of the things that came out in that is is that the labor board agent actually allowed the union to bring two people to vote at the board's office and this was a mail-in election where you had a stipulated agreement so the communications weren't about some small things they were about big things I.E the vote so the stipulation that you shall mail in is really kind of Ironclad and what may seem just kind of like an accommodation really they should have said no we can't you got to go down the street you got to put in a mailbox or something like that a stipulated agreement is the law of the case they have to follow that now if they want to vary it you go to both sides and say we need to vary it as to this employee or that employee but you don't just unilaterally do it after having a conversation with the union and you haven't had any conversation station with company so the guy or gal who might forget to mail it and I forget the mail bills all the time that would take out that variable of whether or not they would actually remember to put it in the mailbox or don't have stamps at home or whatever the variable would be I kind of get that let me ask you this um can you tell us about records brought forward forward by your client that implicates a pattern and practice that the union received accommodations by nlrb in other regions not just Kansas uh Senator let me be very careful how I say this um there's a subpoena that has been issued to my client by the house committee we're in the process of reviewing that and complying with it I can say without going into the details of it that there are documents in there that would indicate that the sort of thing that would happened at this one particular election has happened uh in other elections as well so there is a basis to determine whether or not there has been a pattern in practice not just in Starbucks cases although the house subpoena was limited to Starbucks cases but if it's happened in Starbucks cases is it happening in other cases across the country let me ask you this uh much has been made about the number of filings of unfair labor practices by people seeking to unionize against Starbucks um and yet nlrb in a letter that I submitted for the record earlier or I'm sorry in other documents has stated that over half of unfair labor practices are dismissed or withdrawn as a labor lawyer can you speak to the 10 tactical use of unfair Labor practice complaints in an organizing campaign in my experience the union files unfair Labor practice charges multiple unfair Labor practice charges in every election and it's part of their strategy for handling it and as you said the vast majority of them are thrown out they don't even get to the point of having a hearing because they didn't have any basis in the first place so it is it's a it's a pattern that the union Falls to try to intimidate the employer and try to eat at the time in the election Ms grizzler um the Republicans made it pretty clear that we support the right to unionize but you point out that the labor laws we have are like sometimes 100 years old and yet you promote some reforms that would modernize it if you will and you mentioned for example Major League Baseball special case but in which Merit actually dictates wages along with the Baseline of benefits can you just quickly summarize some other things that if we were to come together on a bipartisan basis you would recommend that we do to help people who seek to unionize but to update the whole concept yeah and there I think the focus has to be on the workers and their choices and so they may choose to have an organizational structure that allows them to pull together and say these certain benefits are important to all of us and we want to have the same level of them but there are other things that we want to be able to negotiate more flexibly and that could also happen across a big company that has multiple different stores in different states that is facing different conditions and I think the importance there is letting the workers have the choice to do that and so work right to work states allow this but they also in those states have representation on everybody so even if the worker isn't paying into the Union they are represented by the union now the union would say that that's a free rider problem so you could eliminate that by saying the union does not have to represent you if you're not paying them so if you want that representation you've got to pay but if you don't want it you can be on your own and you can negotiate by yourself or you can have a separate type of negotiation but just having the choice actually be focused on the worker themselves thank you thank you uh Senator Smith thank you chair Sanders and Reiki member and welcome to all of you it's really I'm glad to see you here and I want to thank you in particular the Starbucks organizers for being here um Ms Carter I understand you organized one of the first stores in the South for um for the Starbucks workers and I wanted to ask you something um Mr Schultz talked repeatedly this morning about this partner relationship that he says that he has with his employees and I'm just wondering from your experience how do you have a partnership with hundreds of thousands of people and when you were doing the organizing in your um in your when you were doing your organizing like what did you find why were people wanting to be part of a bargaining unit thank you so much for your question Senator um so it's about the rules and regulations that are in place and how we are actually able to service the customer throughout covid we really saw a decline in maintenance in our stores we really saw a decline in upkeep and frankly when you report these concerns to your manager it just really feels like you're talking um sometimes to a wall as if you're just not getting any response um so that was a huge Catalyst to why we wanted to organize but also um just the wages and and you know rent rising in our state it's just not something that worked for us and also benefits are just too expensive for us to actually be able to use so rather than forego a paycheck we just choose not to have health insurance so those are a lot of the reasons why we chose to organize and I'll say Howard Schultz does not feel like a partner to me as well thank you um Mr Saxon was there anything I'd like to know what you'd like to add to this and um I'm particularly interested in the challenges that folks have dealing with schedules that are uncertain and unpredictable and um you know you have maybe a promise of some hours that you then don't get and how would being part of a bargaining unit help you deal with those kinds of challenges as a worker thank you to answer the first question you know some of the challenges that we faced were when I when I talked to some of my co-workers they overwhelmingly were talking about the training um it's the training is one week where you're learning everything and then one week where you're practicing everything and then for shift supervisors it's you go through the same Barista training and then you do shift supervisor training which functions the same way then scheduling was a huge thing and this kind of goes into your second question so I currently have at my store someone who used to get 25 hours a week they are a very much so a supporter of our Union they have been reduced down to five hours a week I think that speaks for itself you know if you know they really want to be partners with us they'd hear those concerns you know and they make those changes and they feel so Starbucks has a empty seat that they leave at the shareholder table for their partners they fill that seat and hear what we have to say thank you um Ms block earlier this morning when we were talking with Mr Schultz several of us were pressing him on this disparity in disparities in which the unionized folks were being treated versus the non-unionized people were being treated I particularly was talking about this ability for uh non for the unionized shops to be able to access the credit card tipping mechanism Mr Schultz said that his understanding of the law was that he could not do that now when I questioned him he shifted a little bit and he said well actually it's our preference not to do that could you just address this issue um as you know could you address this issue absolutely uh thank you for the question so I think as Mr Schultz event eventually um was sort of circling around once the union waived its right to bargain over those particular benefits right it would not have been unlawful for Starbucks at least what I can tell from the information that's become public would not have been unlawful for Starbucks to Grant those benefits to the stores that had unionized but there's another dimension too in in in the allegations that in fact withholding those benefits was itself an unfair Labor practice and that goes to the question of why right they made that judgment so if it isn't accurate that the law precluded them from providing those benefits then you say well then then what was the reason and if the reason for withholding those benefits was to retaliate against workers for having a union to intimidate them in how they exercise that right then that crosses the line from just not being accurate sense of the law to being an unfair Labor practice and so that's the question that will now be before the board thank you very much thank you Mr chair thank you uh Senator Smith just a few more questions um recently Starbucks raised their minimum wage I suspect in response to Union organizing but tell me um and certainly it's not just people working in Starbucks what's it like to try to get buying on 15 bucks an hour or 16 bucks an hour number one and number two picking up on Senator Smith's question about scheduling uh uh do people know if they're going to have 40 hours or 30 hours or 20 hours if I go to work how many hours am I going to be working in a week Miss Carter um thank you for your question chairman Sanders um so to address your first question um 15 an hour is not enough to to pay bills and actually survive um in this world today as We Know It uh we often struggle one of the main things I hear from my partners is I can't pay my light bill and put gas in my car at the same time or I can't put gas in my car at the same time and get groceries so just imagine having a ration the most important things that you need to to survive day in and day out um another point that I'm really glad you brought up is the hour requirement in order to obtain benefits and my four years at the company I've never had a problem qualifying for benefits until now suddenly I actually just was taken off of Starbucks benefit policies because I have not been scheduled the appropriate hours or anywhere close to my availability for the better part explain that to the world out here what does that mean yeah so if I am your supervisor I can reduce your work week um and because I've reduced your work week you now lose your benefits is that what you're saying yes sir uh our requirement per week is per week threshold was a belief been removed um so yeah because of that my hours were cut basically since around a little bit before Christmas last year and so I actually just recently lost my benefits because of that hour requirement um so yeah I mean having your benefits tied to your hours when you don't get to determine the hours you work is uh doesn't really seem conducive in my opinion let me go to Mr Saxon um you know people have to pay rent they have to deal with all the the needs of the family how do you do a budget if you don't know exactly how many hours you're going to be working and what kind of paycheck you get at the end of the month I mean you simply can't do a budget when you don't know um like I said there is a partner at my store whose hours went down from 25 to 5. they've now had to do to get a second job you know even with that the scheduling around their second job and with Starbucks how do you have a second job if you just don't know Starbucks puts out its new schedule every three weeks so one week you can have 25 the next week you could have 10 the week after that you could ask that's theoretical is that common does not really happen very common that is very common so how do you know if you're going to be able to pay your rent if you've got 10 hours you get a second job you do doordash which many of my partners in my store have had to do all right tell me about Healthcare I I don't want to misquote the Mr Schultz but you talk something about Comprehensive Health benefits when I hear that I think that people have Universal Health Care that they can walk and the doctor might have to take out their credit card or uh what's going on with Healthcare Miss Connor or or Mr Saxon jumping so with Healthcare I actually had Healthcare with Starbucks I had myself my wife and my daughter covered the thing about the coverage is it's offered in tears so there's like the gold silver and bronze these tears you still have to pay your comfort your co-pay you still have to take out your card when you go to the doctor how much is copay out of curiosity does it depend only it depends on the level that you pick okay so would I be correct in assuming that if I'm working 10 hours a week well first of all I work 10 hours a week or 15 hours a week I don't get that benefit is that correct correct all right and if I'm working 20 hours a week I'm not making enough money to pay the co-payment or the premium right correct you want to elaborate on this doesn't sound like maybe it's quite the comprehensive benefit that it's not very comprehensive at all again um so with every wage increase they increase how much you have to pay into the health insurance so that means more of your check is coming out for subpar health insurance that doesn't cover everything so I have been reduced to going back to just the VA besides my firing um I've had to go back to the VA to get things that Starbucks health insurance would not cover it would seem to me that I was sitting where you were sitting and fighting for a union one of my demands would be consistent and reasonable scheduling that I had some input to uh is is that true thank you Senator Sanders yeah that is absolutely one of our proposals is to have better uh consistent scheduling and also um you know just making sure that well I don't want to misspeak about the bargaining proposals but I do know that having that consistent schedule is definitely something that we are fighting for in this movement because I mean if our benefits are tied to it we need to know that we can get those hours and not have to have this ridiculous availability lit like Jason said keeps you from actually pursuing a second job or pursuing some other form of income what does this availability mean what does that mean um so I believe it was I don't want to misquote what around the time that this was Institute applied to Union doors but for French doors I believe you have to have 180 percent of your hours available on top of the availability that you have if you want to so say for example you want to work 12 hours a week you have to have 18 hours available if you want to work uh I'm bad at math so I'm just going to use that example but yeah that pretty much explains it okay uh anything more that you would like to add um Mr Saxon was cardinal no okay all right on behalf of the committee let me thank all of our panelists uh for your testimony we appreciate it very much uh and uh this uh is the end of our hearing and uh for any Senators who wish to ask additional questions questions for the record will be due in 10 business days April 12th by 5 PM I ask United's consent to enter into the record two statements from stakeholder groups and supportive Starbucks workers and they fight to join a union freely and fairly the committee stance adjourned [Applause] okay

Channel: CBS News

Views: 415,965

Keywords: cbs news, news, live news, livestream, breaking news, howard schultz, starbucks, ceo, senate committee, politics, hearing, unionization, union, bernie sanders, union push

Id: OZwuwYk0jIY

Length: 200min 40sec (12040 seconds)

Published: Wed Mar 29 2023