Starbucks order to pay California employees $105 Million

Discussion in 'Off-Topic' started by cpawfan, Mar 21, 2008.

  1. cpawfan

    cpawfan Monsters do exist

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    http://www.businessweek.com/ap/financialnews/D8VHGUVG1.htm

    <div class='quotetop'>QUOTE </div><div class='quotemain'>A Superior Court judge on Thursday ordered Starbucks to pay its California baristas more than $100 million in back tips that the coffee chain paid to shift supervisors.

    Saying baristas were entitled to $86 million in back tips plus interest, San Diego Superior Court Judge Patricia Cowett also issued an injunction preventing Starbucks' shift supervisors from sharing in future tips.

    Cowett said the practice was a violation of a state law prohibiting managers and supervisors from sharing in employee tips.

    Starbucks Corp. spokeswoman Valerie O'Neil said the company planned an immediate appeal, calling the ruling "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 for the suit to go forward for as many as 100,000 former and current baristas in Starbucks's California stores.

    "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 company has more than 11,000 stores nationwide.

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

    The coffee company also took issue with the brevity of Cowett's ruling, which was only four paragraphs, saying the judge 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.

    Terry Chapko, an attorney for the baristas, said the ruling was a victory, but the case was far from over.

    "Starbucks should be paying their shift supervisors a supervisory wage, not compensating them through tips that legally belong to baristas," he said.</div>
     
  2. AEM

    AEM Gesundheit

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    Considering that the responsibilities of shift supervisors include barista responsibilities, I'm finding this whole suit fairly ridiculous - though I expect little from California courts to make sense.
     
  3. cpawfan

    cpawfan Monsters do exist

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    <div class='quotetop'>QUOTE (AEM @ Mar 21 2008, 11:00 AM) <{POST_SNAPBACK}></div><div class='quotemain'>Considering that the responsibilities of shift supervisors include barista responsibilities, I'm finding this whole suit fairly ridiculous - though I expect little from California courts to make sense.</div>

    I haven't looked into it, but on the surface, it sounds like the judge has something to stand behind

    <div class='quotetop'>QUOTE </div><div class='quotemain'>Cowett said the practice was a violation of a state law prohibiting managers and supervisors from sharing in employee tips.</div>

    That sounds like Starbucks not being aware of California law
     
  4. AEM

    AEM Gesundheit

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    Actually, I believe that California's statute has an impermissible effect on interstate commerce. I was a Shift Supervisor for Starbucks for a while, and while it had a supervisory aspect to it, it also encompassed standard barista responsibilities - and significantly more of the latter.

    More to the point, the practice of having Shift Supervisors share in the tips stems from the fact that they are NOT supervisors in the normal sense of the term. They are paid an hourly wage, unlike Store Managers and Assistant Store Managers, and their duties, as I mentioned above, are substantially the same as those of Baristas - just with added responsibility.

    But California believes that it's ridiculous notions of society should supplant standard practices throughout the rest of the country.

    I want to see a suit by Starbucks challenging the constitutionality of the California statute on the basis of its effect on interstate commerce.
     
  5. Master Shake

    Master Shake young phoenix

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    Doesn't Black Mamba work at Starbucks? Oh my god! He's RICH!
     
  6. cpawfan

    cpawfan Monsters do exist

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    <div class='quotetop'>QUOTE (AEM @ Mar 21 2008, 11:39 AM) <{POST_SNAPBACK}></div><div class='quotemain'>Actually, I believe that California's statute has an impermissible effect on interstate commerce. I was a Shift Supervisor for Starbucks for a while, and while it had a supervisory aspect to it, it also encompassed standard barista responsibilities - and significantly more of the latter.

    More to the point, the practice of having Shift Supervisors share in the tips stems from the fact that they are NOT supervisors in the normal sense of the term. They are paid an hourly wage, unlike Store Managers and Assistant Store Managers, and their duties, as I mentioned above, are substantially the same as those of Baristas - just with added responsibility.

    But California believes that it's ridiculous notions of society should supplant standard practices throughout the rest of the country.

    I want to see a suit by Starbucks challenging the constitutionality of the California statute on the basis of its effect on interstate commerce.</div>

    The problem as I see it is that you are taking a Starbucks-centric view on this law. For most other restaurants and service industry jobs, it is a damn good thing to have legal protection for the staff that supervisors and managers can't share in tips.

    This law protects far more people than it hurts
     
  7. Run BJM

    Run BJM Heavy lies the crown. Staff Member Global Moderator

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    <div class='quotetop'>QUOTE (Master Shake @ Mar 21 2008, 11:40 AM) <{POST_SNAPBACK}></div><div class='quotemain'>Doesn't Black Mamba work at Starbucks? Oh my god! He's RICH!</div>

    Lets not get ahead of ourselves. There's a starbucks on EVERY corner in CA, lets say there are 100,000 city blocks in CA, 4 corners on each means $262.50 for each store and each store has 20 employees. By my (precise [​IMG] ) calculations Mamba will be $13.13 richer.
     
  8. shookem

    shookem Still not a bust

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    It sounds pretty stupid to me (the law and the lawsuit).

    A SS gets what, and extra $.80 an hour or something and they're not supposed to have access to the tips?
    Unless there's a bonus of some kind that compensates for the potential loss of income incurred by being a SS then it becomes really unfair to them.

    My g/f is a manager at a successful restaurant and she doesn't get tips but if the place makes more than X amount in a day, week or month then she gets a good sized bonus.
     
  9. Denny Crane

    Denny Crane It's not even loaded! Staff Member Administrator

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    National companies like Starbucks are supposed to obey the state laws. It's not that big a deal and part of doing business.

    The law is the law, even if it is stupid. It often is stupid [​IMG]

    I don't know enough about the case to render a full opinion of my own (court of public opinion). Maybe the law should be changed, and one way to go about it is to appeal a case like this up the line.
     
  10. AEM

    AEM Gesundheit

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    <div class='quotetop'>QUOTE (cpawfan @ Mar 21 2008, 01:04 PM) <{POST_SNAPBACK}></div><div class='quotemain'><div class='quotetop'>QUOTE (AEM @ Mar 21 2008, 11:39 AM) <{POST_SNAPBACK}></div><div class='quotemain'>Actually, I believe that California's statute has an impermissible effect on interstate commerce. I was a Shift Supervisor for Starbucks for a while, and while it had a supervisory aspect to it, it also encompassed standard barista responsibilities - and significantly more of the latter.

    More to the point, the practice of having Shift Supervisors share in the tips stems from the fact that they are NOT supervisors in the normal sense of the term. They are paid an hourly wage, unlike Store Managers and Assistant Store Managers, and their duties, as I mentioned above, are substantially the same as those of Baristas - just with added responsibility.

    But California believes that it's ridiculous notions of society should supplant standard practices throughout the rest of the country.

    I want to see a suit by Starbucks challenging the constitutionality of the California statute on the basis of its effect on interstate commerce.</div>

    The problem as I see it is that you are taking a Starbucks-centric view on this law. For most other restaurants and service industry jobs, it is a damn good thing to have legal protection for the staff that supervisors and managers can't share in tips.

    This law protects far more people than it hurts
    </div>


    I'm taking the view of what I used to be, a shift supervisor. Being promoted meant an extra couple of dollars an hour and responsibilities added to to regular barista ones. The key part is that I still had all of my pre-existing duties as a barista, and over 90% of my work remained the same as when I'd been a barista.

    I don't necessarily have an issue with a law that states managers can't share in tips - especially when their responsibilities do not lie with regular staff duties. But to apply that to shift supervisors is ludicrous.
     

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