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WASHINGTON — Former Starbucks CEO Howard Schultz testified in a Senate hearing Wednesday, grilled by Democrats on the committee about whether the coffee company violated federal labor laws.
The Senate Health, Education, Labor and Pensions Committee targeted Schultz and Starbucks to examine the corporation’s treatment of employees working to unionize.
It’s part of a larger push from the committee, led by Vermont independent Sen. Bernie Sanders, to hold accountable billionaires and corporations for potentially illegal business practices.
Schultz said multiple times and unequivocally that Starbucks did not break the law.
His testimony comes as Starbucks employees walked out of more than 100 stores last week across the United States to protest the company’s anti-union efforts. More stores plan to hold union elections.
Schultz defended the company to the Senate HELP committee, saying Starbucks respects their employees’ rights and repeated that allegations the company violated labor laws will be proven false.
His testimony follows a threat from the committee to subpoena the former CEO after he previously declined to appear for questioning.
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“The fundamental issue we are confronting today is whether we have a system of justice that applies to all or whether billionaires and large corporations can break the law with impunity,” Sen. Bernie Sanders, I-Vt., who chairs the committee, said.
Did Starbucks violate federal labor laws?
The National Labor Relations Board, or NLRB, filed more than 80 complaints against Starbucks for violating federal labor laws. Charges included the illegal firing of Starbucks workers for working to form a union, employees collectively bargaining for benefits, and advocating for increased wages and better working conditions.
Additionally, there have been more than 500 unfair labor practice charges against the company, according to the Senate committee.
A Starbucks in Buffalo, New York, was the first to unionize in December 2021. Since then, more than 360 stores in nearly 40 states have held union elections. There are now nearly 300 unionized stores in the country.
In March, an administrative judge found Starbucks guilty of “egregious and widespread misconduct” and that the company showed “a general disregard for the employees’ fundamental rights” in the union-organizing efforts in Buffalo. The judge also found Starbucks retaliated against its employees for pushing to unionize.
“We’re confident that those allegations will be proven false,” Schultz said when asked about the allegations.
Former Starbucks CEO: ‘Starbucks coffee company did not break the law’
Schultz defended the company and said he respects the right of every employee whether they choose to join a union or not.
“Starbucks coffee company unequivocally has not broken the law,” he repeated throughout the hearing.
Because of an arrangement made by the union and NLRB in Buffalo, union negotiations must take place at one single store at a time. Sanders and other Democrats on the committee accused Starbucks of intentionally delaying these meetings.
Schultz responded that they have tried to arrange more than 350 separate meetings, which they say must take place through face-to-face negotiations.
Sanders asked Schultz to promise to the committee that the company will exchange proposals with the union.
“On a single store basis, we will continue to negotiate in good faith,” Schultz said.
Republicans defend former Starbucks CEO
Republican senators on the committee defended the CEO, who has ties to the Democratic Party, and applauded him for his success despite their political disagreements.
Sen. Rand Paul, R-Ky., said Americans spending an extraordinary amount of money for a cup of coffee is a testament to capitalism.
“I don’t want to be part of any witch hunt that vilifies any American business so count me out,” Paul said. “Count me as one who is ecstatic that Starbucks is an American success story and I’ll have no party in trashing their success.”
Louisiana Sen. Bill Cassidy, the top Republican on the committee, said allegations against Starbucks have not been fully investigated.
“I am not here to defend Starbucks. I have my own questions about the alleged misconduct and the law should be filed and upheld…. but let’s not kid ourselves. This is not a fair and impartial hearing,” he said.
Mullin points fingers at Sanders
Sen. Markwayne Mullin, R-Okla., turned his questioning to Sanders saying he took offense that Sanders feels all CEOs are corrupt because they’re millionaires.
“It’s bothering to me because Mr. Chairman, you yourself have been very successful,” Mullin said, adding that public records show the Vermont senator has amassed more than $8 million.
“Why is it that all CEOs are corrupt because they’re wealthy? And yet our chairman is wealthy – and I’m glad you are – is not?” Mullin asked Sanders.
Sanders responded that if he’s worth $8 million, “that’s good news for me.”
“I’m not aware of it. That’s a lie,” he said, adding that Mullin has no evidence he ever said that all CEOs are corrupt. “I have never, ever said that.”
“What this hearing is about is whether workers have the constitutional right to form a union,” Sanders said.
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