Starbucks is the favorite cuddly, socially conscious company and so it was no surprise when it vowed to hike its minimum wage for employees.
We're all for companies voluntarily raising the minimum wage, but we recognize that companies have economic considerations. It turns out that even Starbucks may not be magic and is subject to economic forces.
It seems that Starbucks employees are claiming that the company is slashing its workforce (as other companies have done to accommodate highly-praised minimum wage hikes).
Starbucks is denying that it is cutting jobs. Here is the report from Reuters:
An online petition accusing Starbucks Corp of "extreme" cutbacks in work hours at its U.S. cafes, hurting both employee morale and customer service, has been signed by more than 9,000 people.
The world's biggest coffee chain, trying to address cooling growth at its U.S. shops, recently introduced technology that allows customers to order and pay from mobile devices. That service aims to boost sales and reduce bottlenecks in stores.
Starbucks Chief Executive Howard Schultz and other top brass have spoken with Jaime Prater, a Southern California barista and the online petition's creator, the Seattle-based company said.
It declined to give details but Starbucks spokeswoman Jaime Riley said it is not uncommon for Schultz to reach out to members of its 160,000-strong U.S. workforce. She also said no nationwide cutback in labor hours or jobs was underway at Starbucks stores.
Comments on the petition painted a picture of broad discontent at the company known for offering better wages and benefits than other chains, including healthcare coverage, retirement account contributions and paid vacation days.
Prater and many signers say they noticed cutbacks in U.S. staffing hours after Starbucks in April reported a deceleration in quarterly cafe sales growth. Several of them said store managers were under pressure to comply with the dictates of Starbucks' software system.
Almost 7,000 signers of the petition described themselves as employees, according to Prater. They did not give their full names and Reuters was not immediately able to confirm that signers worked for Starbucks.
"The labor situation has gone from tight to infuriating," Prater said.
One central California store has seen its labor allotment shrunk by about 10 percent, even though sales are up, its manager, who asked not to be identified for fear or reprisal, told Reuters.
Minimum wage advocates will no doubt point to cooling of sales as the reason for labor forces cuts (if, indeed, the allegations are correct), and no doubt that is a factor. But operating costs (which include salaries) must be factored into the equation.