In a testy and sometimes confrontational Senate hearing Wednesday, Howard Schultz, who stepped down as Starbucks CEO just last week, faced fiery questions about the company’s illegal union-busting campaign.
“Starbucks has waged the most aggressive and illegal union-busting campaign in the modern history of our country,” Sen. Bernie Sanders (I-VT) said as he opened the hearing. “That union-busting campaign has been led by Howard Schultz.”
Schultz, a billionaire businessman who explored a potential presidential bid in 2019, abruptly stepped down from his role as Starbucks CEO days before Wednesday’s hearing, but he remains on the company’s board. He initially refused to testify before the Senate’s Health, Education, Labor and Pensions (HELP) committee, appearing only after being threatened last month with a subpoena.
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Senators asked Schultz about eight rulings from National Labor Relations Board judges that found Starbucks had committed 130 labor law violations since the union campaign began in Buffalo in December 2021. He repeatedly shrugged off the rulings.
“Starbucks has not broken the law,” Schultz told the committee, “We are confident that those allegations will be proven false.”
When asked if he had ever personally “threatened” a worker who supported the union, Schultz said, “I’ve had conversations that could have been interpreted in a different way than I intended.” (The Starbucks union has filed a complaint with the NLRB accusing Schultz of threatening a worker in California in April 2022.)
In a decision earlier this month, Judge Michael A. Rosas found that Starbucks had committed “egregious and widespread misconduct” including retaliating against unionizing workers, promising better pay and benefits to workers who didn’t unionize, and surveilling organizing workers. Rosas wrote that the company displayed “a general disregard for the employees’ fundamental rights.” Starbucks was ordered to rehire illegally fired workers.
“Every day we wake up thinking about how we can put our people first,” Schultz told the committee, outlining his vision for a company based on “humanity, respect and shared success.” The company’s “preference,” he said, was to have a “direct relationship” with workers, without a union.
Schultz shared his oft-retold story of growing up in a housing project in Brooklyn, New York. His father was injured on the job when Schultz was a child, he told the committee, and the family was devastated when he lost his job. It was this experience, he said, that led him to “build a different kind of company.”
“Starbucks doesn’t need a union,” Schultz told the committee, “We do nothing nefarious. We put our people first.”
Senator Bernie Sanders (I-VT) led the testy hearing on Wednesday.
REUTERS/Julia NikhinsonUnionizing Starbucks workers say they are motivated by low wages, unpredictable hours, understaffing, and expensive benefits.
“I’m a 12-year worker. There’s no one speaking for me but me,” Michelle Eisen, a barista in Buffalo, told The Daily Beast last month. “[Starbucks] are unable to acknowledge that the union is made up of their own workers.”
Democratic senators were also unconvinced by Schultz’s testimony. Sens. Tina Smith (D-MN), Ben Ray Luján (D-NM), Tammy Baldwin (D-WI), and Patty Murray (D-WA), who represents Starbucks’ home state, all shared stories of meeting unionizing Starbucks workers in their states who said their right to organize was being interfered with by Starbucks.
Schultz became increasingly defensive, firing back that he was personally “offended” that Murray was bringing up things she had “heard” from constituents.
“I take offense at you categorizing Starbucks as a union-buster,” Schultz told Sen. Bob Casey (D-PA), who pointed out that the company had been advised by Littler Mendelsohn, one of the country’s top union-busting law firms.
A survey by The Daily Beast last summer found that Starbucks was employing at least 50 Littler Mendelson lawyers, spread across 17 states, according to documents filed with the NLRB.
In one outburst, Schultz—who has a net worth of $3.7 billion, according to Forbes—took offense at being called a “billionaire” by Sanders.
“I came from nothing,” he said, raising his voice, “Yes, I have billions of dollars. I earned it. No one gave it to me.”
Schultz was also visibly angered by Sen. Ed Markey (D-MS), who compared unionizing Starbucks workers to Schultz’s own father, who was fired from his job after being injured.
“Your father couldn’t protect himself. That’s all your workers want,” Markey said. “I don’t think you understand that, Mr Schultz. They are just looking to be someone who can protect themselves in the way your father could not.”
“No, you don’t understand,” Schultz fired back.
Republicans on the HELP committee were broadly supportive of Schultz. Sen. Bill Cassidy (R-LA) described the hearing as a “show trial” and a “smear campaign.”
Schultz was replaced as Starbucks CEO this week by Laxman Narasimhan, a former Pepsi executive. Narasimhan told employees he will work a half day once a month as a barista at different Starbucks locations, according to CNBC.
