Starbucks appealing against tip-sharing class action
In reaction to last week’s ruling that ordered Starbucks to pay California baristas $100 million for tips they had to share with their shift supervisors, the coffee giant is appeal the court decision.
CEO Howard Schultz announced to employees in a voicemail message, “The ruling would take away the right of shift supervisors to receive the tips they earn for providing superior customer service.”
In this same statement released by Starbucks, Schultz criticized the media for “grossly mischaracteriz[ing]” the coffee chain’s system of letting shift supervisors to share in tips left for baristas.
He also said, “We would never condone any type of behavior that would lead anyone to conclude that we would take money from our people.”
Following the California suit, two similar lawsuits were filed in Massachusetts and Minnesota.
The debate surrounds the grey area that shift supervisors fall in — their role crosses over two positions. They make and serve coffee like baristas, but they also direct baristas, set schedules, and take on other managerial work. According to California labor law, tips can be pooled together and distributed among employees, cannot be shared with restaurant owners and their “agents”, who are typically managers or supervisors.
Starbucks argued that this difference in roles is not obvious to the customer, so the shift supervisors should be entitled to the tips.
The original suit was filed in 2004 and was given class-action status in 2006. The California lawsuit was filed in 2004, and was granted class-action status in 2006.
There is a hearing locked in for May 1, 2008 to determine how the California tip money should be distributed.
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