Starbucks ordered to hand back $100m in tips

Reply Fri 21 Mar, 2008 07:55 am
Source: San Jose Mercury News Weekend, 21.03.08, page 17A

Starbucks told to get its hand out of tips pool

By Sandra Gonzales
Mercury News[/URL
Article Launched: 03/21/2008 01:30:30 AM PDT

Tips for baristas stirring the brew at Starbucks could go from "tall" to "grande" faster than you can say caramel macchiato.

Thursday, a San Diego Superior Court judge ordered Starbucks to pay its California baristas more than $100 million in back tips and interest, after finding that the coffee giant had violated state law by sharing employee tips with shift supervisors.

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

But for patrons and employees of Starbucks in San Jose, the ruling left a bitter taste.

"I have yet to walk into a Starbucks where I don't see the supervisor doing something," said Laurie Lind of San Jose. "If it's a significant price difference in what the employee makes compared to the supervisor, then I would see the rationale behind the ruling, but otherwise I don't."

Shift supervisors at Starbucks serve coffee and food but also assign tasks to baristas, and are paid about $2 more an hour, said Rachel Requierme, a shift supervisor at a Starbucks on Almaden Road.

Frank Barberis, 58, of San Jose said when he walks into a Starbucks he often can't tell the difference between the employee and the shift supervisor, who is working just as hard if not more.

"I don't think this should be dictated by the court; this is an owner's decision," he said. "It's getting so you can't even run a business anymore."

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

Chou's 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 the coffee chain'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."

San Diego Superior Court Judge Patricia Cowett also issued an injunction that prevents Starbucks shift supervisors from sharing in future tips.

"I think it's unfair; tips should be shared because we don't do any managerial work, we're always on the floor, we're always serving customers," said Requierme, who makes $12.30 an hour.

Her barista agreed - and not just because Requierme is his supervisor, he said.

"I think it's ridiculous because the supervisor does everything the barista does and more; it wouldn't make sense for them not to get tips. It's all about customer service, and they are the ones who create the environment for the customer," said Kris Johnson, who earns $9.90 an hour.

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

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.

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 procedure 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 Cowett 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 barista 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.

The Associated Press contributed to this report.[/quote]
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Reply Fri 21 Mar, 2008 08:16 am
A barista gets $9.90 an hour? That's about £4.45 in UK money, where the legal minimum wage is currently £5.35 ($10.70) per hour but from April 2008 it will be £5.73 ($11.40). I might add that Starbucks coffee tastes rather like urine, only worse.
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Reply Fri 21 Mar, 2008 08:38 am
not knowing what urine tastes like, I compre Starbucks to badly burnt coffee. I believe that their model is to make coffee so strong and burnt that the only way its drinkable is to turn it into a mixture with an equal amt of cream and foam.
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