Starbucks expands non-union benefits with savings and student loan repayment tools

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Diving Brief:

  • Non-union Starbucks employees can access a student loan repayment management tool and contribute after-tax pay to personal savings accounts directly from their paycheck starting Sept. 19. the company announced on Monday.
  • The coffee chain will also incentivize eligible employees to contribute to savings accounts with $25 and $50 “savings milestone” credits for a total of $250 in incentives per employee.
  • These benefits will take effect less than a month after a National Labor Relations Board office filed a complaint argue that excluding unionized workers from benefits violates national labor relations law.

Overview of the dive:

Starbucks stands by its position that it cannot, by law, extend new benefits to unionized workers without negotiating with Starbucks Workers United on a store-by-store level, a spokesperson said Monday.

But Starbucks Workers United, whose parent union Workers United has declared its intention to waive bargaining rights on an earlier benefits extension, says the continued expansion of Starbucks benefits for non-union stores is intended to deter workers from unionize.

“The NLRB recently filed a lawsuit accusing Starbucks of illegally withholding benefits from employees who work in unionized or unionizing stores,” a union spokesperson said in a text exchange with Restaurant Dive. “Starbucks not only hurts their brand and their business, but irrevocably hurts their credibility as a company.”

Starbucks denies the perks are intended to undo union momentum.

“We are not anti-union. We will continue to invest in our employees as we have for 50 years,” a Starbucks spokesperson wrote in an email to Restaurant Dive.

Starbucks has cultivated a reputation for offering generous perks over other restaurant brands, including perks like 401(k) with matching contributions, medical coverage, and a college tuition plan.

These latest additions to benefits are intended to help workers improve their financial stability by saving for unexpected expenses and managing student debt, Starbucks said in a statement.

The student loan repayment management tool is a product of Tuition.io, an educational workplace benefits company. According to a press release, Starbucks is giving workers “access to new tools, resources, and one-on-one coaching for managing student loan debt, such as repayment options and loan refinancing.”

The Savings Advantage, developed in partnership with Fidelity, gives employees who sign up to save at least $5 per paycheck and a one-time $50 cash incentive. Workers who remain in the program for one quarter and maintain a savings balance greater than $50 will receive a quarterly cash incentive of $25 for up to six quarters. The company will pay an additional $50 to workers who end a month with a savings balance above $400.

New benefits have emerged as a key retention tool, alongside salary increases, for restaurant employers when the labor market has turned tough. New perks range from Grubhub’s instant payment service, which debuted in June, to Noodles & Company’s immigration reimbursement plan. Starbucks has announced a number of benefits and salary changes this year, from raised compensation for travel expenses incurred by workers seeking abortions or gender-affirming health care in states where such services are prohibited or unavailable.

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