“CAUTION: Contents are Hot” . . . and so are Class Action Wage Claims

Starbucks Baristas

Oh, Starbucks! Why is it that everyone always seems to be picking on you?!

This time, it seems that some baristas don’t like to share.

On Thursday, March 20, a California Superior Court judge in San Diego awarded a class of 100,000 baristas an astounding $105 million in unpaid tips. Now that’s a LOT of quarters tossed in the metal milk frother, eh?

The suit was initiated by Jou Chau, a college student who worked at a San Diego Starbucks location in 2003-2004. He filed the suit that was later converted into a class action.

The claim alleges that supervisors wrongfully shared in the employees’ tips. California law permits tip pooling–where everyone tosses their tips in the pool and then the tips are divided evenly among all who contributed. But pooling wasn’t the problem. California law prohibits restaurant owners or their “agents” from sharing in the pool. “Agents” has generally been interpreted as managers and supervisors.

Like the counter employees, (“baristas” as they’re known to most), shift supervisors at Starbucks make coffee and serve customers. They do the same work as the beloved baristas but they are also responsible for setting work schedules and managing employees.

Fair or Unfair?

So why can’t they share in the reward? To some, this line might seem a bit attenuated. The purpose of the division between supervisor and employee is a reasonable one. Owners and managers who don’t have to slave away with the employees who deal directly with the public shouldn’t be able to swoop in at the end of the shift just to take their “share” of the booty. In that context, the law seems perfectly fair.

But in the Starbucks scenario, the fairness seems to fade some. If the dividing line between “supervisor” and “employee” is little more than who makes the weekly schedules and who has the pleasure of taking customer complaints, it doesn’t seem strikingly unfair that they should share in the tip pool. Afterall, their expert frothing skills likely helped earn some of the tips.

Wider Implications

Starbucks, the Seattle-based coffee chain, said it would appeal the decision, which it described as “fundamentally unfair and beyond all common sense and reason.” But if the appeal is unsuccessful, the implications of the decision could have real impact on the day-to-day operations of stores. Starbucks would likely have to stop using supervisors for double-duty–they could either do supervisory duties or employee duties, but not both.

Given the size of the stores, does it really seem practical to have a supervisor assigned to every shift who hangs out in the office while the baristas sweat it out at the espresso machine? Probably not. But why would supervisors do the work required of the baristas and not be eligible for the same rewards? And don’t forget the cost! An added employee would be needed to cover the work that the supervisor can no longer perform.

But the real question on the minds of coffee lovers across the nation is, “Will this mean a price hike for our morning cup?” Now that is a serious implication, for sure!!

The N.Y. Times reported this story on Friday, March 21. And the Starbucks Union (IWW Starbucks Workers Union) has a different viewpoint, which you can read about here.

[Hat tip to the Class Action Defense Blog]

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