Workers At Starbucks Cafe In Mesa Vote To Unionize In Latest Threat To Corporate Profits

A growing number of Starbucks’ corporate-owned stores are launching unionization efforts, emboldened by a handful of stores in upstate New York.

The latest effort comes from Mesa, Arizona, where workers at a company-owned cafe located on Power Road and Baseline Road voted 25 to three in favor of unionizing under Workers United, a branch of the Service Employees International Union. A second store in Mesa has already filed for a union election. Ballots from the NLRB were sent out Friday afternoon and will have to be received by March 18.

The store is the first Starbucks cafe outside of the Buffalo, New York area to unionize, and the third overall.

To date, more than 100 Starbucks locations have filed for union elections, all within the last six months and doubling their count in the last month alone after the first victories in Buffalo. These cafes represent a small fraction of Starbucks’ footprint in the US – the company presently counts almost 9K company-owned restaurants across the US.

The NLRB’s regional director will now have to certify the ballots from the Mesa vote, a process that could take up to a week. After hte count is confirmed, the union will face its next challenge: negotiating a contract with Starbucks. US labor laws do not require that the union and Starbucks reach a collective bargaining agreement. Workers who lose faith in the union can always petition to decertify after one year.

Starbucks has insisted it will bargain with unions in “good faith”.

“We are excited and hopeful to start the bargaining process with Starbucks, but we also know that Starbucks is fighting us tooth and nail,” Liz Alanna, a shift supervisor at the Mesa store, said in a statement. “We’re calling on Starbucks to stop their war against the labor movement and work with us, not against us.”

Jefferies analyst Andy Barish wrote in a Thursday note to clients that unionizing doesn’t appear to be a major financial risk to Starbucks in terms of large hourly wage increases or benefit demands. However, the chain could suffer damage to its reputation if handled improperly, he said.

“It is hard to imagine this issue turning into a maelstrom of negative PR for SBUX, but it does surely present near-term ‘headline risk’ for the stock, which has been weak of late,” Barish wrote.

It certainly doesn’t bode well for the company’s operating profit margin, which came in at 18% during Q1 FY2022. Expensive orders with lots of modifications and add-ons inspired by social media platforms like TikTok have helped bolster margins over the past couple of years, but they have also made workers complain about being treated like “coffee-making robots” and fueled the push for unionization.

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