The Starbucks board of directors is asking its shareholders to vote no on a proposal during next week’s shareholders’ meeting that would require the coffee giant to produce annual reports on harassment and discrimination in the workplace.
The shareholder-introduced proposal five would require Starbucks to release annual reports “describing and quantifying the effectiveness and outcomes of company efforts to prevent harassment and discrimination” against employees on the basis of sex, race, religion, national origin, age, disability, gender identity and sexual orientation, and would need to include the number of harassment and discrimination suits settled by the company, the average length of time it takes to settle harassment complaints, and whether Starbucks uses nondisclosure or mandatory arbitration to settle its employee complaints.
“Starbucks recently resolved allegations made by the Equal Employment Opportunity Commission concerning alleged racial bias in its employee promotions,” the supporting statement reads. “[…] Workplace abuse, harassment, and discrimination can result in substantial costs to companies, including legal costs, costs related to employee turnover and increased absenteeism and reduced productivity. They may also lead to difficulties in recruiting new employees.”
The statement of support for proposal five refers to “multiple media reports of allegations and lawsuits claiming that the company failed to protect employees from discrimination and harassment,” like a former barista who claimed in a 2020 lawsuit that Starbucks failed to protect her from sexual harassment. The recent allegations resolved with the EEOC refers to a March 2021 case that claimed Starbucks shows racial bias in promoting employees.
Starbucks is asking shareholders to vote no against this proposal because the company feels it already does enough to prevent and address workplace harassment and discrimination including extensive workplace training and established process for reporting harassment and discrimination, including an anonymous helpline. Starbucks also refers to the external audit committee that oversaw and evaluated its civil rights and protections policies.
The company further addressed the arbitration concerns brought forth in the shareholder proposal by stating that although “claims relating to a partner’s employment, including claims of discrimination, harassment, and retaliation, are subject to arbitration,” employees are not subject to nondisclosure agreements and can privately and publicly talk about cases open with the company.
“Given our continuing commitment to create and maintain a respectful workplace, supported by our policies, partner training, team of highly trained investigators, the unique and important elements of our arbitration program, and our board’s ongoing oversight, our board believes that issuing a public report, as contemplated by this proposal, is unnecessary and will not benefit our shareholders or our partners,” Starbucks said in the proxy statement.
SBWorkersUnited — the Starbucks union that so far represents employees at six Starbucks stores — was disappointed in its parent company's reaction.
"We are organizing our union to give all of us as partners a voice in the workplace and the ability to hold Starbucks accountable," the union said in a statement sent to Nation's Restaurant News. "Harassment and discrimination are issues that many partners experience, and transparency around these problems is a necessary step toward systemic change. We are disappointed that Starbucks is also resisting this attempt to hold them accountable."
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