| Starbucks told to hand back $100m |
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| Friday, 21 March 2008 | |
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Coffee shop empire Starbucks has been ordered by return tips totalling $100 million to its workers.
The suit brought by former Starbucks employee Jou Chou was handed class action status in 2006 and the case subsequently went forward on behalf of around 100,000 current and former baristas in California. The San Diego Superior Court decided that the firm had broken a state law barring managers and supervisors from taking a share of tips received by employees. The state law says that gratuities meant for hourly workers cannot be taken by an employer or its agents. Judge Cowett found that Starbucks supervisors were agents. A total of $86 million wrongly distributed to supervisors in Starbucks branches must now be returned to the coffee-makers - called 'baristas' at Starbucks - plus interest. The total sum was calculated after expert testimony put the average income from tips at $1.71 an hour, multiplied by the number of hours worked by shift supervisors. Starbucks plans to appeal, with a spokesman for the firm describing the verdict as "fundamentally unfair and beyond all common sense and reason". The firm said it believes that shift supervisors deserved their fair share of the tips that they received from the tip jars in the California stores. "This case was filed by a single former barista and, despite Starbucks request, the interests of the shift supervisors were not represented in this litigation. As a result, Starbucks believes that the Court’s decision is not only contrary to law, it is fundamentally unfair and beyond all common sense and reason," according to spokeswoman Valerie O'Neil. She described the court's decision as an extreme example of an abuse of the class action procedures in California’s courts. Related links |
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