6-1 Case Study: Starbucks - Management
Instructions
Read the three articles noted below about an actual union-organizing effort involving Starbucks in New York City:
Judge Says Starbucks Violated Workers Rights at NYC Stores
NLRB Orders Starbucks to Reinstate Two Workers, But Not a Third
Court Sides With Starbucks In Dispute Over Labor Union Pins
After reading all the articles and considering additional research, address the following questions (feel free to use supplemental authoritative resources in your response):
Do you think the administrative law judge and the National Labor Relations Board (NLRB) went too far in overruling Starbucks? Why or why not?
How much leeway should an employer have in setting standards for conduct, customer interaction, and attire in the workplace?
Does the NLRB decision unfairly limit Starbucks in the management of the stores? Why or why not?
What is your view of the courts decision?
For additional details, please refer to the Short Paper and Case Study Rubric document.
OL 318 Short Paper/Case Study Analysis Rubric
Requirements of submission: Short paper assignments must follow these formatting guidelines: 1-2 pages, double spacing, 12-point Times New Roman font,
one-inch margins, and discipline-appropriate citations.
Critical Elements Exemplary (100\%) Proficient (85\%) Needs Improvement (55\%) Not Evident (0\%) Value
Main Elements Includes all of the main
elements and requirements
and cites additional
information to illustrate each
element
Includes all of the main elements
and requirements
Includes some of the main
elements and requirements
Includes few or none of the
main elements and
requirements
25
Inquiry and Analysis Provides in-depth analysis that
demonstrates complete
understanding of all concepts
Provides in-depth analysis that
demonstrates complete
understanding of most concepts
Provides analysis that
demonstrates understanding
of some concepts
Does not provide analysis
and/or shows lack of
understanding of concepts
20
Integration and
Application
All of the course concepts are
correctly applied
Most of the course concepts are
correctly applied
Some of the course concepts
are correctly applied
Does not correctly apply any
of the course concepts
10
Critical Thinking Draws insightful conclusions
that are thoroughly defended
with evidence and examples
Draws informed conclusions that
are justified with evidence
Draws logical conclusions,
but does not defend with
evidence
Does not draw logical
conclusions
20
Research Incorporates many scholarly
resources effectively that
reflect depth and breadth of
research
Incorporates some scholarly
resources effectively that reflect
depth and breadth of research
Incorporates a few scholarly
resources that reflect depth
and breadth of research
Does not incorporate
scholarly resources that
reflect depth and breadth of
research
15
Writing
(Mechanics/Citations)
No errors related to
organization, grammar and
style, and citations
Minor errors related to
organization, grammar and style,
and citations
Some errors related to
organization, grammar and
style, and citations
Major errors related to
organization, grammar and
style, and citations
10
Total 100\%
OL318ShortPaper/CaseStudyAnalysisRubric
2 Management Report / March 2009
© 2009 Wiley Periodicals, Inc.
Management Report DOI: 10.1002/mare
A UFCW spokesman said the key to the union victory was not the
exodus of Hispanics, but bridging the divides between races.
Certainly, in some other situations—such as among janitors and
health care workers—unions have been successful among Hispanic work-
ers, even those who are here illegally.
Some say a more important factor was court involvement. The com-
pany and the union agreed on election terms as part of a settlement of
lawsuits filed against each other.
Ultimately, it may have been the union’s persistence that paid off.
“They let everyone know that they were in it for the long haul,” an
organizer from a farmworkers’ union observed. “When you give the
people hope, and that hope is not going to go away, people tend to side
with you.” n
Judge Says Starbucks Violated Workers’
Rights at NYC Stores
A New York City Industrial Workers of the World local—which also
is known as the “Starbucks Workers Union”—may be making some head-
way in its ongoing campaign to organize Starbucks workers at four New
York City stores. An administrative law judge (ALJ) has ruled that the
company unlawfully restricted workers’ union activity and fired three
workers due to their support for the union.
Starbucks kept workers from wearing union buttons, using bulletin
boards and talking about unions and working conditions, the ALJ said.
Thus, the company interfered with, restrained, and coerced employees in
the exercise of rights guaranteed by the National Labor Relations Act,
the judge said.
The ALJ also said the evidence showed Starbucks fired three employ-
ees due to their union activity. She recommended that the NLRB order
the company to reinstate the workers with back pay.
Union Insignia
In March 2006, the company settled prior unfair labor practices
(ULPs) filed by the union and entered into an agreement that recognized
the right of its employees to wear “reasonably-sized-and-placed buttons or
pins that identify a particular labor organization or [an employee’s] sup-
port for that organization.”
Based on its interpretation of the settlement, the company told em-
ployees they could wear only one pin.
The ALJ said her review of the evidence showed that employees
wore numerous pins on their uniforms, hats, or aprons while work-
ing. The judge said the company failed to prove there were special
circumstances showing that wearing of more than one insignia may
jeopardize safety, damage machinery or products, exacerbate em-
ployee dissension, or unreasonably interfere with the employer’s public
image. Absent such evidence, the limit of one union-related pin was
unlawful.
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8 Management Report / March 2009
© 2009 Wiley Periodicals, Inc.
Management Report DOI: 10.1002/mare
Bulletin Boards
At Starbucks’ Union Square East store, there was
a back room that contained two bulletin boards. One
bulletin board was reserved for company use, but there
was a dispute about the use of the second bulletin
board. The company said it had a long-standing policy
that employees could not post personal notices on the
second bulletin board. The judge said the evidence
showed that the timing of Starbucks’ announcement
of this policy was “directly in response to open union
activity” and that the company’s stated policies on
bulletin board use had either been “unenforced or ap-
plied in a very liberal manner by store management.”
Therefore, the alleged policy was unlawfully applied
to discriminate against union supporters and union-
related notices.
Talking About the Union
Store managers had told employees they could not
discuss the union while they were working, based on
the company’s rule against solicitation during work
time. The judge said the evidence showed that Star-
bucks permitted social conversations on a variety of
topics during work time. The Board has held there is
a difference between soliciting an employee’s support
for the union and holding a brief conversation about
union-related matters, the judge noted. Starbucks’
use of its no-solicitation rule to prohibit union talk
during work time was unlawful, because it singled
out union talk while allowing social conversation on
other topics.
The ALJ also concluded that supervisors unlaw-
fully prohibited employees from discussing work-
ing conditions, limited employees’ off-duty access to
stores, and prevented some employees from working
additional shifts at other locations. In addition, she
found that three employees had been unlawfully fired
because of their activity or comments in support of the
union (Starbucks Corp., NLRB ALJ, No. 2-CA-37548,
12/19/08). n
(Continued from page 2)
union to represent you. It doesn’t even mention an
election.
IF I SIGN ONE OF THESE CARDS, CAN I GET IT
BACK?
The union never gives the cards back. You can
write to them asking for the card, but I’ll bet you they
will never return it to you. n
What You Can Say About a
Union
This is the fourth article in a series that began
with discussion of the acronym PITS. “PITS” is an easy
way for supervisors and managers to remember the
kinds of actions that will cause an unfair labor practice
finding from the National Labor Relations Board. The
forbidden actions are promises, interrogation, threats,
and surveillance.
With so much to remember about what you can’t
do or say, it’s important to note there is a great deal
you can say. You can give your opinion without threat-
ening. You can make statements, and you can show
employees facts, all without asking questions or mak-
ing threats or promises.
Here are examples of permitted statements:
You MAY tell employees that the vast majority of
workers do not belong to labor unions. You may
communicate the facts that (1) less than 7 percent
of the private workforce in our country belongs to
unions and (2) the trend in union membership has
been downward for many years.
You MAY tell employees of your bad experiences
with unions in general, or the unhappy experi-
ences of your friends and relatives.
You MAY tell employees what you know about
the union and about restrictive provisions in the
union’s constitution such as fines, assessments,
dues increases, union “trials,” and similar rules
that give the union power over their work lives.
Our campaign manager will provide you with the
information you need. Be sure your statements are
truthful.
You MAY tell employees about restrictive language
in union contracts at other facilities that would
make them worse off than under present policies.
You MAY tell employees why you believe they will
be better off without the union.
You MAY tell employees who express resistance
to signing a card for the union that they have the
right to speak out against it and to tell coemploy-
ees about the company’s good points and why a
union is not needed. (But don’t directly ask or di-
rect a worker to campaign against the union; just
tell them they have the right to do so). n
4 Management Report / January 2010
© 2010 Wiley Periodicals, Inc.
Management Report DOI: 10.1002/mare
to restrain, coerce, or interfere with rights guaranteed
employees by the Act.
Meaning for Management
As can be seen from this case, Board decisions on
whether the employer committed an unfair labor prac-
tice can turn on subtle definitions, such that many
remarks supervisors or managers might naturally
make may be unlawful. It is virtually impossible for
untrained supervisors to avoid committing unwitting
violations of the Act.
Considering the hefty fines for unfair labor prac-
tices that are anticipated with the eventual passage of
some version of the Employee Free Choice Act, super-
visory training before organizing activity commences
is an imperative. n
Making the Case That EFCA Is
Remedy for Hard Times
You might think that today’s economic hard times
are not a good climate to make the radical changes in
labor law that would occur if any version of the pro-
posed Employee Free Choice Act were enacted.
That is not how the measure’s most ardent sup-
porters see it. Blogging for the Drum Major Institute
for Public Policy, a progressive think tank, Amy Traub
argues that current conditions make it clearer than
ever why the EFCA is needed. Hers are arguments we
are likely to hear from other supporters when the U.S.
Congress gets back to consideration of the measure.
Traub observes that businesses are finding that
one place they squeeze out a little extra profit in these
difficult economic times is by reducing labor costs. In
some cases, wages have been cut or planned increases
withheld. Many workers are also being saddled with
increases in their contributions for health insurance,
as employers switch to high-deductible or other plans
that require higher employee payments.
Another method of belt tightening at the expense
of workers that is being widely employed, Traub says,
is to reduce the payroll by reducing staff, and then
demanding that the remaining workers work harder
and for longer hours, which they will do to avoid losing
their own jobs and having to look for another in this
dismal job market.
All this means working people are bearing the brunt
of the economic downturn, Traub argues. The remedy,
she claims, is “to give workers more power in the work-
place, enough to push back and stop making America’s
working families the single easiest target for every
negative economic development. The Employee Free
Choice Act was a good idea before the recession, when
middle-class Americans weren’t sharing the benefits of
economic good times, but it’s absolutely essential now
that working people are bearing the disproportionate
brunt of the economic hard times,” Traub says.
One important fact unmentioned in this pro-EFCA
spin is that unions have been unable to protect their
members from layoffs and terminations during this
recession. n
NLRB Orders Starbucks
to Reinstate Two Workers,
But Not a Third
The NLRB has ordered Starbucks to reinstate
with back pay two former employees who were fired
for supporting a union. In a partial victory for the
company, the Board declined to order reinstatement
for a third worker whose behavior was not protected
(Starbucks Corp. d/b/a Starbucks Coffee Co., 352
NLRB No. 99 (2009)).
In March 2006, Starbucks had settled various
charges filed by the union and entered into an agree-
ment approved by an NLRB regional director that
recognized the right of employees to wear “reasonably-
sized-and-placed buttons or pins that identify a par-
ticular labor organization or a partner’s support for
that organization.”
Starbucks officials interpreted the settlement to
limit employees to wearing a single union button and
told employees they could wear only one pin. The
Board, however, agreed with the administrative law
judge (ALJ) that the company could not convincingly
support its assertion that there was a compelling busi-
ness reason to restrict employees to one prounion pin.
The Board adopted the ALJ’s findings that Star-
bucks discriminated against certain employees by pro-
hibiting them from using a company bulletin board and
from talking about unions and working conditions, by
Protected ConductEFCA Watch
© 2010 Wiley Periodicals, Inc.
Management Report / January 2010 5
Management Report DOI: 10.1002/mare
disparately enforcing its dress code, and by preventing
certain employees from working shifts at other Star-
bucks locations.
The company had offered business justifications for
several of its actions, but the judge found the arguments
were undermined by evidence that rules were used to
limit union-related conduct and were not consistently
enforced against other forms of employee activity.
Deliberate Intimidation Not Protected
In a partial victory for the company, the Board
reversed the ALJ’s finding that Starbucks’ discharge
of employee Iris Saenz was a violation. After a union
meeting, Saenz pursued a Starbucks regional vice
president for nearly two city blocks shouting threats,
taunts, and profane comments at him. Starbucks dis-
charged Saenz for her conduct “due to the fact that
she was not following our guiding principle of treating
people with respect and dignity.”
The Board considered whether the NLRA protected
Saenz’s conduct because she had been at a union rally
prior to the event. “Employees are permitted some lee-
way for impulsive behavior when engaged in concerted
activity,” the Board said, but added that “this leeway is
balanced against an employer’s right to maintain order
and respect.”
The Board applies four factors to analyze conduct
that occurs in connection with otherwise protected ac-
tivity: the place of the discussion, the subject matter,
the nature of the employee’s outburst, and whether the
outburst was provoked by an employer’s unfair labor
practice. The Board found that when Saenz engaged in
deliberate intimidation, she lost the act’s protection. Of
the four factors, the Board said only the subject matter
weighs in favor of protection of Saenz under the act. n
Sample Letter
After Card Signing
Dear Employee,
A BIG MISTAKE HAS BEEN MADE.
I have been informed that employees have signed
cards saying they wanted a union here.
First, I want you to know that I do not care whether
or not you signed a card. There will be no consequences
to you if you did or did not sign the card.
However, I am concerned with making sure you
understand what a BIG MISTAKE this is. I want to
outline below some information that perhaps you’re not
aware of regarding unions and the false pretense under
which many of you may have signed these cards.
I believe you are being taken advantage of. Have
you looked into unions in general, and in particular
this union??? Unions survive by adding members who
pay dues, who pay their salaries. The union trying to
get the right to charge you dues, Local 210, has lost
MORE THAN HALF OF ITS MEMBERS IN THE
PAST FEW YEARS ALONE! Why would members
leave the union unless the union was NOT delivering
on promises they offered? ALSO—if the union gets in,
your paycheck will be drastically REDUCED! You will
each spend hundreds and hundreds of dollars each
year on union dues—so you can pay the people that
run this union hundreds of thousands of dollars a year
taken from hard-working people like you.
THEY NEED YOU TO CONTINUE TO SUPPORT
THEIR SALARIES. WHOSE BEST INTEREST DO
YOU REALLY THINK THEY HAVE IN MIND—
THEIRS OR YOURS?
I have been told that many of you were tricked
into signing these union cards. You either did not
know what you were signing or you signed under the
false pretense that your supervisors Joe and Miguel
signed the cards. They did not sign—and do not want
to unionize. Some of your co-employees here have had
bad experiences in unions before and absolutely DO
NOT want to unionize, because all a union does is take
money out of your own pocket.
Understand that the union did not create your
job. We did. The union did not hire you. We did. The
union did not provide you with the highest yearly pay
you have ever earned. We did. The union did not give
you job security. We did. The union did not make our
product. We did.
You should know that this is the WORST time to
even think about unions: unemployment is the highest
it has been in our country for a long time, many compa-
nies are going out of business or laying off employees,
we have not made a profit in months, and my partners
and I have stopped taking a paycheck from the com-
pany so that we can keep the company going. Even
with the bad times we have experienced, our company,
YOUR company, made many improvements.
We gave you raises, health insurance, and dental;
added air conditioning; started Pizza Fridays, built a
more comfortable workplace; and have attempted to
save our company and give you job security. We have
Campaign Workshop
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Losinski forwarded the article on a priority basis to Mary Scott
Losinksi wanted details on use of the ED at CGH. He asked the administrative resident