Starbucks Must Give Baristas $100M In Tips

(AP)  A Superior Court judge on Thursday ordered Starbucks Corp. to pay its California baristas more than $100 million in back tips and interest that the coffee chain paid to shift supervisors.

San Diego Superior Court Judge Patricia Cowett also issued an injunction that prevents Starbucks' shift supervisors from sharing in future tips, saying state law prohibits managers and supervisors from sharing in employee gratuities.

Starbucks spokeswoman Valerie O'Neil said the company planned an immediate appeal of the ruling, calling it "fundamentally unfair and beyond all common sense and reason."

The lawsuit was filed in October 2004 by Jou Chou, a former Starbucks barista in La Jolla, who complained shift supervisors were sharing in employee tips.

The lawsuit gained ground in 2006 when it was granted class-action status, allowing the suit to go forward for as many as 100,000 former and current baristas in the coffee chain's California stores.

It was not immediately clear how many current and former employees are affected by the ruling.

"I feel vindicated," Chou said in a written statement released by attorneys. "Tips really help those receiving the lowest wages. I think Starbucks should pay shift supervisors higher wages instead of taking money from the tip pool."

California is Starbucks' largest U.S. market, with 2,460 stores as of Jan. 8, the latest count available. The Seattle-based company has more than 11,000 stores nationwide.

Starbucks employs more than 135,000 baristas in the U.S. The company did not immediately respond to a request for a head count in California.

The judgment comes as Starbucks is struggling to revive its U.S. business, where store traffic has slipped amid a sagging economy, rising energy and dairy costs, and growing competition from cheaper rivals.

The company's stock has slid more than 50 percent since late 2006, when it was trading close to $40 a share. Starbucks shares rose 3 cents to $17.53 Thursday.

Starbucks earned more than $672 million on revenue of $9.4 billion during its 2007 fiscal year, which ended Sept. 30.

The judge ordered Starbucks to pay $87 million in back tips, plus interest of $19 million, bringing the total judgment to about $106 million.

The company said it planned to ask the court to stay the ruling while the appeal is pending.

"The decision today, in our view, represents an extreme example of an abuse of the class-action procedures in California's courts," O'Neil said.

The coffee company also took issue with the brevity of the judge's ruling, which was only four paragraphs, saying she failed to address the unfairness to shift supervisors.

"This case was filed by a single former barista and, despite Starbucks request, the interests of the shift supervisors were not represented in litigation," O'Neil said.

But attorney Laura Ho, who tried the baristas case, said the court's verdict follows state law.

"Starbucks illegally took a huge amount of money from the tip pool to pay shift supervisors, rather than paying them out of its own pocket. The court's verdict rightfully restores that money to the baristas," Ho said.

[wardoglrs]

This Vid Explains the truth.

http://www.heyokamagazine.com/HEYOKA.12.%20MoneyMasters.htm

[b-easy63]

and then seamlessly transitioned into the other (more lucrative) job. This is in the retail sector.

Posted by bikinigirl2 at 10:15 AM : Mar 22, 2008


As an aside, in a true recession, the hardest hit are the unnecessary industries. This would mean retail will suffer the most job losses and closed businesses as people are laid off from mfg jobs and no longer support the auxillary industries like buying stuff they do not really need and no longer have the money for.

As a veteran of many recessions, I can say without a doubt that as jobs in mfg are cut, those stores that depended on those worker''s buying start to really feel the crunch and have to cut back.
In other words, in a recession, one of the safest fields to be in is the healthcare industry (because people can''t help getting sick) one of the most risky is retail (because people stop spending on stuff when they fear or already have lost their jobs) I would NOT recommend anyone in the restaurant business go into retail right now.

People often will still eat out, long after they stop buying unnecessary stuff for their homes or for fashion.

WAtch the news, stores and other retail outlets are the first to fold--and the people who were employed? Out on the streets.

[gmond]

Workers who depend on tips have been ripped off for years. It is only the ubiquity of Starbucks that make them such an easy target. Just try getting a lawyer to bring suit against the local diner for the same practices.

[sistatee-2009]

Starbucks should move to China for some of that cheap child labor.

[b-easy63]

Some may, like you have the luxury to hold on and do better--many more will not have that. But I stand looking and see an even worse scenario than we had in 1982. When unemployment #s were kept low (like now) by shuffling the rolls not real jobs. At any rate, this is not to disparage the idea of hope or striving--but to simply point out the harshness of the times--and either way--there is no point in attacking you or your words of hope. If people get that from you and can run with it--it is a good thing. I apologize for letting my own neurosis about this recession, color the way I responded to your posts.

[b-easy63]

Posted by NAUcoming4U at 05:50 PM : Mar 21, 2008

Actually, it is really not fair to you to sound my angst at not only what Starbucks has done, but to rail against what is coming. The fact is, many, many Americans do not at this time have the luxury of even change. A time in a recession comes when even the most horrendous of menial jobs will be coveted. I know. Been there. Done that. I am very well off now (years later) but in the early 1980''s I was a degreed applicant that pounded the sidewalks and stood in line with over 400 other professionals--for two line jobs at McDonalds. It can get that ugly.

Ever notice the knee jerk reaction of those who went through the Depression? Notice they seem to want to hoard food or think nothing is greater or of more value than lots of food in the house or a house? Well we live with the residuals of the experiences we have. Years later, with job security pretty well in hand (as much as it can be) I still find myself looking for "for hire signs" and trying to determine the best game plan if my husband''s company downsizes. Having to look almost 3 years for ANY job, in the wrong part of the country will do that to you. You see opportunities now, and you are right--but I see more people without jobs than opportunities. I feel their uncertainty and if they are laid off with bills--their fear. next post

[naucoming4u]

Finally, b-easy...

Ultimately, the term "for the people by the people" no longer just refers to American citizens. In fact, it is quite clear that the American (working class) citizens are the lower priority of our government.

And with that, I must go, to do other things right now. I''ll say our conversation/debate was quite interesting and enjoyable (for me at least).

Good day b-easy63. Happy Good Friday and Easter.

[naucoming4u]

Posted by b-easy63 at 05:41 PM : Mar 21, 2008
(my responses in CAPS)

"See? Idealistic."

WRONG (about me) AGAIN!

"Of the 3 Candidates running for President--we do not have even 1 that is not offering amnesty to the illegals already here--"

NO ******!!! I NEVER SAID I SUPPORTED ANY OF THE THREE MAJOR CONTENDERS. I ONLY HESITANTLY SUPPORT OBAMA AT THIS TIME.

"The fact is, since you brought up political ideas--is that not one candidate has put forth a plan for stabilizing the dollar or inflation, tethering our deficit and putting America back in the black--add to that a recession and every candidate pushing their plans for spending even more money and you can easily figure out that the last person they are considering are the types of people at Starbucks or a restaurant."

(No more caps, but here is the conclusion to my response):

Again, no ******. It is obvious that the three major Presidential contenders speak a good game about "the American people", but their actions rarely ever positively affect those of the lower echelons of society. You don''t realize how our opinions about America, current and future, are actually similar. But I think you have got hung up on a couple of sentences of my posts that set you off. You see, I am well aware of the competition Americans face in the job market... illegal immigrants in the service sector and construction jobs... and legal H1-B and L2 VISA immigrants in the (mostly) high tech and other white collar jobs.

[naucoming4u]

(continued from below)...

Again, there are certain jobs where illegals are prevalent, but it is not all service jobs and certainly not in all regions of the country. In retail sales, it is important to be able to communicate effectively in English, of which most illegals are not fluent in. Employers in the retail service sector, including Starbucks (which is considered retail by their corporate standard), look for skills (communication skills).

Of those jobs where both American citizens and illegal immigrants are competing, it is extremely challenging. This will only become far more challenging if the next President allows/grants amnesty and work permits to all of the tens of millions of illegal immigrants here today. If that occurs, then the economy will suffer further, the working class will suffer further, and ultimately... America will suffer further. (Does that still sound "elitist" to you)?!

I have the utmost understanding of retail/food/service sector jobs because I have been there/worked there for well over a decade, in one capacity or another. You, b-easy, misunderstand my message(s). Have you worked in this industry of which we speak?

[naucoming4u]

Posted by b-easy63 at 05:28 PM : Mar 21, 2008
..........

Geeze easy... you still don''t understand... me... or what I am trying to say! That is what makes you think I am an elitist... of which I am not. My job is not, by any means, a high level job. But you seem to think that everyone in the low-level service jobs are "stuck" there. None of them are STUCK there, but that is the problem with your lack of understanding, and what I am trying to say.

And most of all, I never suggested that people go off and quit their job to go look for their "dream job". I, once again, said that it IS possible to search for other work, even if only 10 minutes a day, WHILE THEY ARE STILL WORKING AT THEIR CURRENT EMPLOYER!

It is foolish to quit a job, especially in this market, to begin searching for other work. Only a moron would quit his or her job and expect to pick up another job instantly. I know this because I see people do this all the time, and most of the time, these people fail. Those who have asked me, and whom I have consulted, eventually found other work while they were at their current employer... and then seamlessly transitioned into the other (more lucrative) job. This is in the retail sector.

(continued above)...