The current Starbucks controversy started in 2021 when Starbucks employees in New York formed Starbucks Workers United to ask for better working conditions. According to various sources, Starbucks didn’t want its employees to unionize, so it set about union-busting – making work and life harder for unionized staff.

At Business2Community, we analyzed news articles, social media posts, and the official websites of Starbucks and Starbucks Workers United to provide a complete overview of the Starbucks controversy. We’ll cover the key events in the controversy so you can understand why things went wrong and see how you can do better within your organization.

Starbucks Controversy – Key Facts

  • Starbucks employees in Buffalo, New York unionized in 2021, forming Starbucks Workers United.
  • Starbucks has been accused of union busting; reducing investments in unionized stores, firing union employees, and offering benefits to only non-union employees.
  • In 2024, Starbucks and Starbucks Workers United agreed to build a constructive relationship and resolve issues around the partner benefits and Starbucks brand use.

The Story of the Starbucks Controversy

The Starbucks controversy centers around the company’s union-busting activities. After employees working in certain Starbucks coffee shops unionized, the company allegedly employed anti-union tactics such as offering fewer benefits to pro-union workers. Here’s how the controversy unfolded.

Start of Starbucks Workers United

In 2021, Starbucks employees from different stores in Buffalo, New York got together to create Starbucks Workers United. They strived for a better workplace, having faced understaffing, unpredictable scheduling, low pay, and workplace harassment over the years. With the union, they aimed to negotiate better benefits, salaries, and working conditions for all employees.

In an open letter to the then-CEO Kevin Johnson, the union organizing committee wrote that a true partnership requires power-sharing and accountability, especially considering the coffee company calls its employees “partners”.

Buffalo’s success at unionizing sparked a wave of similar movements across other Starbucks stores across the US. Between 2021 and 2022 alone, more than 250 stores across nearly 40 US states voted to unionize.

Starbucks’ Response to the Union

Starbucks founder Howard Schultz visited Buffalo in September 2021 to speak with the employees. Two months after his visit, he wrote a letter to Starbucks partners, mentioning the union:

No partner has ever needed to have a representative seek to obtain things we all have as partners at Starbucks. And I am saddened and concerned to hear anyone thinks that is needed now

In 2022, Starbucks announced that Kevin Johnson would retire, and Howard Schultz would take over as interim CEO.

Union Busting Criticisms

A month after Schultz’s return as CEO, Starbucks excluded unionized stores from the new benefits it would offer. According to NPR, the coffee company announced expanded training, improved sick leave, and credit card tipping to 240,000 Starbucks employees in over 8,000 non-unionized stores.

“We do not have the same freedom to make these improvements at locations that have a union or where union organizing is underway,” said Schultz in a conference call.

Starbucks has been heavily criticized for firing union-seeking employees. In 2022, it fired seven pro-union employees in Memphis, yet denied that the firings were related to the unionization effort. Similarly, Lexi Rizzo, a shift supervisor and one of the founders of the Buffalo union got fired in 2023. According to the coffee company, Rizzo got fired for tardiness, not union organizing.

Starbucks and Workers United Agreement

Laxman Narasimhan became the Starbucks CEO in 2023. At the end of the same year, the company sent a letter to Starbucks Workers United to agree on how to proceed with contract negotiations in the US. They reached an agreement in February 2024. Starbucks agreed to resolve issues with the partner benefits, including credit card tipping in unionized stores.

“It became clear that there was a constructive path forward on the broader issue of the future of organizing and collective bargaining at Starbucks,” said the coffee company in the statement announcing the agreement.

Other Starbucks Controversies

Besides union busting, Starbucks has also been criticized for ethical sourcing concerns, tax evasion, and political issues.

  • Ethical sourcing concerns: In early 2024, a consumer group sued Starbucks for falsely claiming its coffee and tea products to be ethically sourced. According to the group, the sourcing practices for Starbucks coffee in Kenya, Brazil, and Guatemala involved human rights abuses. Starbucks said it would defend itself against these claims.
  • Stance in the Israel-Hamas Conflict: Starbucks sued Starbucks Workers United for trademark infringement in October 2023 over a pro-Palestinian social media post. This was a few days after the start of the conflict in the Middle East, and the coffee company said it received over 1,000 complaints since a lot of people confused Workers United with the Starbucks Coffee Company. Starbucks asked the union to stop using a similar logo to the brand. This incident started a boycott against Starbucks, from consumers standing in solidarity with the millions of suffering innocents in Gaza.
  • European Tax Evasion: Since 2012, Starbucks has been involved in tax evasion discussions in Europe. Reuters led a four-month investigation in 2012 to find out how the company paid £8.6 million in tax over 14 years in the UK. According to a tax expert, what Starbucks was doing was tax avoidance, and although controversial, it wasn’t illegal. In 2015, the European Commission investigated the company’s tax practices in the Netherlands and concluded that it needed to pay €20-€30 million for recovery.

The Consequences of the Starbucks Controversy

Although Starbucks reached an agreement with Workers United, it has experienced several consequences of union busting over the years.

Starbucks Worker Strikes and Red Cup Rebellion

By 2022, Starbucks workers had held over 55 strikes in 17 different US states, protesting the company’s anti-union practices. Starbucks Workers United created a strike fund of $1 million to pay workers on strike, while supporting the pro-union workers who lost their jobs at Starbucks.

“Starbucks pretends to be an ally and so progressive but they are the opposite and I genuinely have been shocked at how low they’re willing to go,” said Sam Amato, a pro-union worker who got fired.

In November 2023, Starbucks Workers United organized the largest strike in the company’s history. The strikes were particularly planned for Red Cup Day, one of Starbucks’ biggest events for the holiday season. Named Red Cup Rebellion, the strike involved thousands of Starbucks workers walking out of over 200 stores.

By protesting, workers drew attention to their concerns about understaffing, the intensity of work during promotional events, and the company’s overall approach to their demands for better working conditions. As a result, Starbucks enabled the workers to pause mobile ordering.

Starbucks Boycott Movement and Public Reactions

Both union busting and the company suing Starbucks Workers United over a pro-Palestine post led consumers to boycott Starbucks.

Senator Bernie Sanders called out Starbucks for not respecting labor law. Sanders especially highlighted how Starbucks led “the most aggressive and illegal union-busting campaign in modern history,” and announced he supported Starbucks Workers United in negotiating a fair contract.

Besides the general public, celebrities including Mark Ruffalo, Susan Sarandon, and Jane Fonda, expressed solidarity with Starbucks Workers United. “These workers aren’t asking for that much. They’re simply calling for a safe, secure, and respectful workplace with a living wage,” said Jane Fonda, highlighting the importance of Starbucks joining the bargaining table.

After Starbucks Workers United shared a now-deleted pro-Palestinian social media post, Starbucks sued the union. Former CEO of Starbucks, Howard Schultz, reached out to the Orthodox Jewish Chamber of Commerce, expressing his support for Israel.

Palestine supporters called for a boycott movement, with the hashtag #BoycottStarbucks peaking on TikTok in November 2023. Protesters and activists gathered in front of Starbucks stores and chanted “Starbucks, you make drinks for genocide,” referring to Schultz’s support of Israel’s brutal carnage waged against Gaza.

In December 2023, Starbucks released a statement, stating that it was not affiliated with any government or military organization, including the Israeli military. “As a giving company, we stand for humanity. We stand for human connection. We strongly abhor hate, violence, and attacks on the innocent,” wrote Starbucks CEO Laxman Narasimhan.

Lawsuits Against Starbucks

While Starbucks has consistently denied engaging in illegal union-busting tactics, the company has frequently been the subject of lawsuits reported by well-known media outlets.

Reuters - Ex-Starbucks CEO Schultz illegally threatened union supporter, NLRB judge rules

There were nearly 100 complaints have been filed against Starbucks by the National Labor Relations Board, based on charges from union workers. The company still has ongoing lawsuits, such as a 2022 case where a federal judge ruled that Starbucks wrongfully terminated seven pro-union employees in Memphis. The Supreme Court agreed to hear the case in 2024, as Starbucks said it has not used anti-union practices.

Company-Wide Changes

After the Red Cup Rebellion in November 2023, Starbucks experienced a nearly 9% decline in its share price, amounting to nearly $11 billion. According to analysts, multiple factors contributed to this decline, and the boycott calls may or may not have had an effect.

That said, the union’s organizing efforts have led to certain company-wide changes. Two years after the start of the union, the coffee company announced a reinvention strategy. Aiming to make the Starbucks brand stronger, the strategy involved investing more in Starbucks employees. By the end of the 2025 financial year, Starbucks aims to pay double the hourly income it paid in 2020 and expand its employee benefits.

In February 2024, three months after the launch of the reinvention strategy, Starbucks and Workers United agreed to discuss bargaining and organizing agreements, representing a big milestone in the controversy. Both parties shared the news on their official websites.

Starbucks Press Release - Message from Sara: Starbucks and Workers United Agree on Path Forward

What Can We Learn From the Starbucks Controversy?

Starbucks has long prided itself on offering competitive benefits, including healthcare, stocks, education, and company perks. However, the Starbucks controversy shows that even well-regarded companies can have issues with what they consider their strong suit.

Starbucks Workers United was formed as a result of employees’ concerns with short staffing, unpredictable hours, low wages, and working conditions. This suggests a gap between the company’s self-image as a leader in employee benefits and the actual employee experience, highlighting the importance of putting employees first.

Starbucks’ responses to the unionization efforts were criticized by the general public, academics, and celebrities, as the company struggled with effective crisis management and decision-making.

After Laxman Narasimhan became CEO in 2023, Starbucks made progress in managing the union effort. Coming to an agreement with Starbucks Workers United was an important milestone, and a big step toward settling the anti-union controversies around the coffee company.

As of 2024, the negotiations are still in their early stages, but depending on how they proceed, big companies and business leaders can gain insights into how to work with unions and prioritize their employees.


Why are people boycotting Starbucks?

What was the Starbucks scandal?

What is Starbucks’ main issue?