Food Service & Agriculture, Human Resources, and Retail

Coffee chain 'accelerates' raises, stock grants and benefits after tax reform

January 25, 2018
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Starbucks store workers employees baristas
Courtesy Starbucks

A coffee chain with locations across West Michigan is investing $250 million in employee wage increases, stock grants and benefits.

Seattle-based Starbucks said yesterday the investment in its more than 150,000 Starbucks employees is being “accelerated by recent changes in the U.S. tax law.”

Starbucks has 287 stores in Michigan.

The company was unable to provide specifics about Michigan’s share of the investment.

“Just as we have always felt strongly that our partners are key to our business success, we have also known offering a valuable, comprehensive benefits package helps us retain our valuable partners,” said Kevin Johnson, CEO, Starbucks. “The value of Starbucks benefit package fully accessed is unmatched by other retailers and provides thousands of dollars above the value of other companies’ compensation offerings.”

Johnson said Starbucks has made an investment of nearly $800 million in employee compensation and benefits in the past four years.

The newly announced investment includes several parts.

In April, all eligible U.S. hourly and salaried partners will receive a second wage increase in addition to the annual increases they have already received this fiscal year. This will include an investment of about $120 million in wage increases that will be allocated based on regional cost of living and laws that vary from state to state. Starbucks already pays above the minimum wage in all states across the country.

On April 16, Starbucks will provide an additional 2018 stock grant for all eligible full-time, part-time, hourly and salaried U.S. employees across its stores, plants and support centers who have been active as of Jan. 1, 2018. All Starbucks retail employees will receive at least a $500 grant, store managers will each receive a $2,000 grant and plant and support center employee grants will vary depending on annualized salary or level. This investment is valued at more than $100 million.

A new employee and family sick time benefit will be available to all eligible U.S. employees, which will allow employees to accrue paid sick time based on hours worked and then use them if they or a family member needs care. When this benefit goes into effect this year, a partner working 23 hours a week can expect to accrue about five days of sick time benefit over the course of one year.

For store employees, Starbucks has also expanded its parental leave policy to include all non-birth parents with up to six weeks of paid leave when welcoming a new child.

Starbucks also reaffirmed its commitment to create more than 8,000 new part- and full-time retail jobs and an additional 500 manufacturing jobs at its Augusta, Georgia soluble coffee plant.

The moves announced yesterday are in addition to the nearly $7 billion that Starbucks said it will invest to build and renovate stores, manufacturing plants and technology platforms in the U.S. over the next five years.

Starbucks said it remains “committed to providing opportunities to tens of thousands of Americans from disadvantaged backgrounds.”

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