Starbucks halts share buyback as Schultz turns to workers | business news

By MATT OTT, AP Business Writer

SILVER SPRING, Md. (AP) — Starbucks founder and new interim CEO Howard Schultz announced Monday that the coffee chain was suspending its share buyback program to “invest more profits in our people and Our shops”.

The shift in strategy comes just three weeks after Starbucks announced that Schultz, who bought the company in 1987 and led it for more than three decades, would take over the company’s top job until it finds a permanent CEO. Since that announcement, analysts and pundits have speculated that Schultz was returning to help the company fight a growing campaign for workers’ rights that has seen six of its stores vote to unionize since December, with at least 140 more. in 27 states filing petitions to unionize. elections.

Two weeks ago, baristas and other employees at a Seattle Starbucks voted to unionize, the first such vote in the city where Starbucks originated. Starbucks has 9,000 of its own stores in the US.

Schultz’s blog post on Monday was full of references to “partners,” as the company calls its employees. “My first job is to spend a lot of time with partners,” Schultz wrote. “To raise voices”.

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In his previous time with the company, Schultz, 68, successfully fought attempts to unionize Starbucks stores and roasting plants across the U.S. Starbucks had to reinstate laid-off workers or pay to resolve labor violations. labor law numerous times under Schultz’s leadership in the early 2000s.

Last year, the National Labor Relations Board found that Starbucks illegally retaliated against two Philadelphia baristas who were trying to unionize. The NLRB said Starbucks monitored employees’ social media, illegally eavesdropped on their conversations and ultimately fired them. He ordered Starbucks to stop interfering with the workers’ right to organize and offered to reinstate the two workers.

Most recently, on March 15, the NLRB issued a complaint against Starbucks alleging that district and store managers in Phoenix spied on and threatened workers who supported unionization. The complaint says Starbucks suspended one union supporter and fired another.

In a November letter to employees, released just before the first unionization votes at three stores in Buffalo, New York, Schultz said he tried to create the kind of company his blue-collar father never had a chance to work for.

He recalled his family’s trauma with no income after his father suffered a workplace injury, saying that’s why Starbucks has benefits like health care, free college tuition, paternity leave and employee stock grants. .

“No partner has ever needed a representative to seek out the things that we all have as partners at Starbucks. And it makes me sad and concerned to hear that anyone thinks that’s necessary now,” Schultz wrote.

Schultz is holding a town hall with employees on Monday.

Late last year, Starbucks announced it was committing to a $20 billion dividend and share buyback program to return profits to investors. It’s unclear how much of that figure would have gone to share buybacks.

Shares of Starbucks fell more than 3% in premarket trading and are down more than 20% since the beginning of the year.

Starbucks announced on March 16 that Schultz would step in to replace retiring CEO Kevin Johnson.

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