Starbucks announces pay and benefits increases—for non-union employees

Thousands of workers at Starbucks stores around the U.S. will see their hourly salary increase by at least 3% at the start of 2024.

The coffee chain announced the higher compensation and benefit improvements late Monday. Not all of the new perks will be available to all unionized employees, however. A company spokesperson said union employees will receive annual wage increases consistent with raises of recent years.

“Throughout our history, we’ve shared our success with partners by consistently investing in industry leading wages and benefits,” said Andrew Trull, senior manager of corporate communications at Starbucks. “As we work to reinvent the company, we continue to create value for our partners by improving wages and scheduled hours for all partners. […] Starbucks will give all union-represented partners annual wage increases differentiated by tenure in alignment with previous, historical adjustments for each store.”

Starbucks Workers United, the union representing workers in over 360 Starbucks stores, had some issues with the announcement, however.

“Once again, Starbucks is responding to our bargaining demands, but they’re implementing them in nonunion stores and denying these new benefits to workers in stores that are unionizing or already voted to join the union,” said Alex Yeager, a member of the union, in a statement. “Withholding benefits from unionized stores is against the law, and we will file an unfair labor practice charge in response.”

In late September, a National Labor Relations Board judge ruled that the coffee chain violated the law by not granting the same pay and benefits to unionized employees as it did to their non-union coworkers. Starbucks has appealed that ruling, arguing that the employment agreements of unionized baristas can’t be changed unless workers and the union ratify new labor contracts.

Starbucks operates approximately 17,000 stores in the U.S. Beginning January 1, all union and non-union workers will see their salaries increase at least 3%, with workers who have been there two to five years receiving a 4% increase. (The minimum pay raise the company is offering is below the current rate of inflation, which stands at 3.7%.) Non-union workers with more than five years’ experience will receive a 5% bump, for which union employees are not eligible if their stores unionized prior to November 2022. Hourly workers will also be able to accrue paid vacation time 90-days after they are hired, beginning in February. This benefit also excludes workers who had unionized before the benefit was introduced.

“Investing in our partners is what drives our success,” said Sara Trilling, executive vice president and president of Starbucks North America in a statement. “It’s what makes us all partners. And an important way we do this is by investing in our partners’ journey, to bridge to a better future at Starbucks and beyond.”

The higher pay announcement comes days after Starbucks announced plans to open another 17,000 locations by 2030. Roughly 15,000 of those will be in international territories, nearly doubling the company’s non-U.S. footprint. Starbucks plans to open another 2,000 stores domestically.

The news also followed Starbucks’ blowout earnings, where the company saw quarterly sales jump 11.4% to $9.37 billion and adjusted earnings of $1.06 per share (trouncing analyst estimates of 97 cents).

Correction, November 7, 2023: A previous version of this article misstated which 2024 pay increases union employees at Starbuck are not eligible to receive. Both union and non-union employees are eligible for 3% and 4% raises.