By now, most have heard of the ongoing saga surrounding Starbucks and its over 400 locations which have filed with the federal National Labor Relations Board (“NLRB”) to hold union elections. To date, over 400 elections have been held with over 330 union victories to just 77 losses – an 81% winning percentage which is virtually unheard of by historical standards. Starbucks’ battle with the union began in August 2021 and continues to rage with two to three new elections requested every week. In contrast, is Ben & Jerry’s. The union filed an election request at one store and Ben & Jerry’s didn’t fight it; they voluntarily recognized the union without the need for an election. The question is why such a difference?
The Starbucks’ Approach
During this union drive, Starbucks has been the subject of merciless scrutiny by the media and accused of over 1,000 violations of the labor laws (called Unfair Labor Practices “ULP’s”) many of which are still pending before the NLRB. For Starbucks, which was once considered the employer of choice for Quick Service Restaurants (“QSR”), these past two years have seen its reputation dragged through the mud. It has refused to come willingly to the bargaining table to try to reach agreement with the union. Instead, it has been accused of hundreds of charges of “union busting” by its employees.
In the two years since the first Starbucks in Buffalo, New York, filed to unionize, Starbucks has had extensive turnover in its leadership, including two CEO’s and its president of North America. In an effort to win public support, it even brought back its once-beloved and legendary CEO, Howard Schultz. Schultz’ return was the Board’s attempt to stabilize the company and provide a steady hand during the ongoing union campaigns. Unfortunately, instead of providing a steady hand, he inflamed employees with his unwillingness to negotiate and was accused of union-busting tactics. As a result, Shultz’ third turn as CEO was short-lived with him resigning just days before he was to testify before Congress on Starbucks’ dealings with the union.
The Ben & Jerry’s Way
In stark contrast to Starbucks, Ben & Jerry’s recently had its first union campaign at its Burlington, Vermont, location. The union drive came on the heels of the Burlington store management choosing not to leave its tip jar out during the companywide free scoop giveaway day. This decision was poorly received, and although eventually reversed, the damage was done. The result was a push for unionization. The union campaign spread like wildfire and very quickly the union claimed to have the support of all the employees at the store.
What Ben & Jerry’s did next was amazing and in stark contrast to the route Starbucks has chosen. Ben & Jerry’s management chose to voluntarily recognize the union.
Why this is Important?
Both Starbucks and Ben & Jerry’s have a history of being pro-employee, pro-social justice, pro-social change organizations. These reputations were built over decades and were a cornerstone of each company’s culture. In the course of less than a year, Starbucks severely damaged that reputation. Perhaps seeing what has happened to Starbucks, Ben & Jerry’s management made the shocking decision to not challenge the union, perhaps indicating its willingness to enter into a union contract with Scoopers United. In doing so, Ben & Jerry’s has received a mountain of positive press and has kept its stellar pro-employee reputation intact.
What this will mean for the next Ben & Jerry’s location to try to unionize is yet to be seen, but if the past month is any indication, it appears that the union may have found fertile ground at Ben & Jerry’s.
The Reality of the Situation- What does all this mean for these companies?
Starbucks has taken the approach that it will not willingly sit down and negotiate with the union, choosing instead to deal with reputational damage. Say what you will about Starbucks’ approach, it may be working. Starbucks stock price is up nearly 33% since its first store won its union election and its earnings are back above their pre-pandemic levels.
The company appears to be taking a calculated risk: delaying entering a contract with the union for as long as it can, knowing that efficiency and lower labor costs should be maintained as long as possible. And, perhaps as a backdrop to all this, hoping that the Presidential election of 2024 will return the NLRB to a pro-employer (i.e., Republican) slanted Board.
Conversely, Ben & Jerry’s has elected to take the path of least resistance, choosing instead to embrace its employees’ right to unionize. Where this ends up – higher wages, increased benefits, more unionized stores, remains to be seen. But for now, at the start of the outdoor ice cream season in much of the country, their bet appears to be paying off. Instead of receiving front-page news about unionizing stores and union-busting efforts by management, it is receiving kudos for remaining true to its corporate culture. Time will tell if one of these strategies is right and the other is wrong!
Brody and Associates regularly advises its clients on all labor-management issues, including union-related matters, and provides union-free training. If we can be of assistance in this area, please contact us at info@brodyandassociates.com or 203.454.0560.
