Starbucks to pay about $35M to NYC workers to settle claims it violated labor law

NEW YORK (AP) — Starbucks will pay nearly $35 million to more than 15,000 New York City employees to resolve allegations that it denied them stable schedules and arbitrarily reduced their work hours, city officials announced Monday.

The company will also pay a fine of $3.4 million within the scope of the agreement With the city’s Department of Consumer and Worker Protection. He also agrees to abide by the city’s rules. Fair Working Week Act going forward.

A company spokesperson said Starbucks is committed to operating responsibly and in compliance with all applicable local laws and regulations in every market in which it does business, but also noted the complexities of city laws.

“This (law) is extremely difficult to administer, and it’s not just Starbucks’ problem, almost every retailer in the city faces these roadblocks,” spokeswoman Jaci Anderson said.

Most affected employees in hourly positions will receive $50 for each week they work from July 2021 through July 2024, the department said. From now on, workers who encounter a violation may be entitled to compensation by filing a complaint with the ministry.

The $38.9 million deal also guarantees employees laid off during recent store closures in the city the chance to return to work at other company locations.

The city began investigating in 2022 after receiving dozens of worker complaints against various Starbucks locations, eventually expanding the investigation to hundreds of stores in the city. The investigation found that most Starbucks employees never had regular schedules and that the company routinely reduced employees’ work hours by more than 15%, making it difficult for employees to know their regular weekly earnings and plan for other commitments such as child care, education or other work.

The company also routinely denied workers the chance to pick up extra shifts, inadvertently leaving them on part-time status, according to the city.

The agreement with New York comes as the Starbucks union continues a nationwide strike at dozens of locations. started last month. The number of stores affected and the impact of the strike are still disputed between the two sides.