Former Starbucks chief executive Howard Schultz unequivocally denied that the coffee giant had broken the law in its fight against unionization during tense questioning from Sen. Bernie Sanders on Wednesday.
“I am not, because Starbucks coffee company did not break the law,” Schultz said.
But Sanders (I-Vt.) kept the pressure on Schultz during the tightly packed hearing.
“Over the past 18 months, Starbucks has waged the most aggressive and illegal union-busting campaign in the modern history of our country,” Sanders said. “That union-busting campaign has been led by Howard Schultz, the multibillionaire founder and director of Starbucks who is with us this morning only under the threat of subpoena.”
Schultz repeatedly clashed with Sanders and Democratic lawmakers throughout Wednesday’s Senate hearing on whether Starbucks had broken federal labor laws, the experience of Starbucks workers and whether they had reason to unionize. Sanders repeatedly returned to the company’s record on violating U.S. labor law, but Schultz held steadfast that these determinations would not stand up to the company’s legal appeals.
The push to unionize Starbucks is one of the most high-profile labor campaigns in decades. Starbucks workers since late 2021 have voted to unionize at almost 300 locations out of more than 9,000 corporate-owned stores in the United States, while the company has unleashed a full-blown campaign to stamp out the union.
Schultz initially declined to testify at Wednesday’s hearing, but he relented after Sanders, the committee’s chairman, threatened to hold a vote earlier this month to subpoena him. Schultz stepped down from his role as Starbucks chief executive last week and passed the reins to Laxman Narasimhan.
Schultz in his testimony described Starbucks as a liberal, forward-thinking company that was among the first major employers to begin providing benefits, such as stock options, health care and 401(k) retirement benefits to its workers.
“We are a different kind of public company that balances profitability with social conscience,” Schultz said. “Aspiring to achieve that vision has been my life’s work.”
Schultz also talked about growing up living in poverty in public housing in New York City “without resources or adequate benefits.” When his father, a delivery driver, slipped on ice and injured himself, he was fired, Schultz said.
“The image of my dad, lying on the sofa and immobilized in a body cast has been burned into my memory,” Schultz said. “I decided at an early age that if I ran a business, it would be a company based on respect and shared success, unlike the company that had fired my dad.”
But Senate Democrats took aim at Schultz’s notion that Starbucks workers had such good benefits that they did not need a union.
“You’re a billionaire and they are your employees,” said Sen. Tina Smith (D-Minn.). “The imbalance of power is extreme, and that is why people want to come together to form a union.”
“Your father had no rights and your family paid the price. That is how your workers now feel,” said Sen. Edward J. Markey (D-Mass.). “They have no rights.”
“Is there a union contract that you personally are aware of that provides comprehensive health insurance, equity in the form of stock options, free college tuition?” Schultz replied. “You don’t understand.”
Schultz, a registered independent, found an ally in Senate Republicans, who praised his contributions as a businessman and accused the National Labor Relations Board of misconduct.
“It’s somewhat rich that … you’re being grilled by people who have never had the opportunity to create a single job and yet they believe that they know better how to do so,” said Sen. Mitt Romney (R-Utah).
Sen. Bill Cassidy (R-La.) said that while Schultz is not above the law and workers have the right to unionize, the NLRB “is operating in violating its own operation and procedure,” noting allegations that it had collaborated with Starbucks Workers United.
“I am not here to defend Starbucks,” Cassidy said. “But let’s not kid ourselves. These hearings are anything but a fair and impartial proceeding. It is not surprising that Mr. Schultz was reluctant to testify.”
The NLRB has issued 83 legal complaints against the company so far in response to 513 unfair labor practice charges lodged against the company, according to agency spokeswoman Kayla Blado. Nearly 100 charges have been filed with the NLRB against Schultz himself over statements he made during meetings with union members around the country, Sanders’s press office said.
Starbucks “strongly denies any wrongdoing and has committed to exercising its right to defend itself” against claims that it violated labor law, company spokesman Andrew Trull said.
“In many of these proceedings, the NLRB is attempting to use cases against Starbucks to change existing labor law — not because Starbucks is failing to comply with the law as it exists today,” Trull said.
Scores of Starbucks corporate employees and union baristas flew in from around the country to attend the hearing. The corporate employees donned shirts that said “We belong together,” while the baristas shirts’ said “We are the union.”
Two Starbucks union members testified, one of them, a veteran, was fired after leading a union drive at his store in Augusta, Ga., the union said.
“These workers are up there to testify about the absolutely abhorrent conditions that we’ve faced in the last 18 months because of this union drive but also about the conditions that led to this union drive,” said Michelle Eisen, a Starbucks barista and union organizer in Buffalo.
Sanders and Schultz both have working-class Brooklyn origins, but they hold clashing visions for labor relations in the United States.
Schultz, who considered seeking the Democratic presidential nomination before endorsing Joe Biden in the 2020 election, characterizes Starbucks as an entity that cares deeply for its workers. But he sees unionization as an existential threat to the company that he built.
Meanwhile, Sanders, a self-proclaimed socialist whose multiple bids for the Democratic nomination included a run against Biden in 2020, has spent decades fighting for unions and the labor movement. He has been an outspoken critic of Starbucks’s stance toward labor organizing.
Starbucks and the union have had roughly 85 bargaining sessions since October. The meetings have often stalled over a disagreement about whether to allow union members observe remotely by Zoom, which the company opposes.
NLRB prosecutors said this week that Starbucks violated the law by refusing to bargain if some workers observed over videoconferencing technology. A company spokesperson previously told The Washington Post said Starbucks has not attempted to delay bargaining and that the company has come to the table as legally obligated.
Sanders told The Washington Post that the hearing had focused on Starbucks because of its “egregious” behavior. If Starbucks reaches a contract with its employees, he said, other companies around the country would be less inclined to fight unionization campaigns using illegal tactics.
“If on the other hand, Starbucks can get away with breaking the law and not negotiating a contract, other large companies will say ‘Hey, we can break the law, as well,’” he said.