business news in context, analysis with attitude

The New York Times reports this morning that Starbucks is being sued by yet another former barista who is charging that he – and thousands of other baristas – were cheated when the company allowed shift supervisors to share in tip money.

As the Times notes, “The lawsuit was inspired by a ruling last month in which a state judge in San Diego awarded $105 million to baristas throughout California, after finding that Starbucks had improperly allowed shift supervisors to share tips.” Starbucks is challenging the ruling.

Meanwhile, a Massachusetts barista also is suing the company on similar grounds.

The Times reports: “At Starbucks’ more than 7,000 shops nationwide, the baristas leave a tip jar near the checkout counter. The workers pool the tips each week, and typically shift supervisors and baristas divvy up that money based on the hours each employee has worked. Other types of supervisory employees, like shop managers and assistant managers, do not share in the tips … In a statement, Starbucks said it was unfortunate that copycat lawsuits had been filed in the weeks after the California ruling and that it intended to appeal. ‘Our tip policy allows hourly partners (baristas and shift supervisors) to receive their fair share of customer tips,’ the company said. ‘Shift supervisors are not managers and have no managerial authority.’ The company said that shift supervisors often do the same work as baristas.”

KC's View:
I actually think that Starbucks probably is right on this one, but that doesn’t mean that it is going to be able to spin the news in its own favor. At this point, this story has taken on a life of its own…and Starbucks has to resolve it. Quickly.

Maybe the solution is to give everybody a raise and get rid of the tip jar. I’m not offended by it, but plenty of people seem to be…and at this point, it is just exacerbating the company’s image problems.