How Starbucks Workers Unionizing Can Affect QSR Brands

If you haven’t heard, Starbucks workers have been organizing to create a union for more than a year and 17 corporate locations have already voted to form a union, Starbucks Workers United. Around 170 locations plan to vote in the coming weeks and months where workers are asking for higher pay, more hours, and better safety protections among other proposals.

The restaurant industry is known for being difficult to unionize due to having high rates of turnover and a more easily replaceable workforce. On top of this, union membership in the U.S. has been in decline for the last few decades. However, this historic moment might create a shift and have a lasting impact on the quick-service restaurant industry.

What Are Labor Unions?

Labor unions are organized groups of workers who come together to advance their interests such as wages, benefits, and working conditions. The goal of unions is to bring economic and social justice to the workplace. Currently, there are more than 60 unions in the U.S. representing roughly 14 million workers.

Labor unions have long been a controversial issue among those who believe that workers should be allowed to organize and coordinate efforts to improve working conditions and those who believe that unions are prone to corruption and racketeering. Below we’ve brought together the advantages and disadvantages of labor unions.

Employee Advantages of Being in a Labor Union

• Provide worker protections: In most U.S. states, non-union workers are at-will employees. Employers can fire employees for virtually any reason with the limitation of discrimination. However, for union members, there must be just cause.
• Promote higher wages and benefits: Through collective bargaining, unions are able to secure higher wages and better benefits such as increased pay, health coverage, paid time off, and parental leave.
• Promote economic change: Even though the U.S. workforce has not been 100% unionized, unions do impact trends that benefit all workers. Examples include the minimum wage, OSHA guidelines, and overtime rules.

Employee Disadvantages of Being in a Labor Union

• Unions are not free and require payment or fees for representation: Depending on the union, some workers may have to pay a portion of their salaries in order to receive the benefits of union representation.
• Discourages individuality: Workers are bound by the decisions of the union even if they disagree with the decision.
• Harder to be promoted: Seniority is a key factor that unions recognize rather than talent, merit, and productivity.

Brand Advantages of Being in a Labor Union

• Lower turnover: Workers who are satisfied with their job will not want to leave in search of something better, especially in the restaurant industry.
• Competitive hiring: Showcasing higher wages and benefits can attract new talent.
• Productivity: Workers who appreciated their work environment can deliver quality products and services to guests.

Brand Disadvantages of Being in a Labor Union

• Higher labor costs: Union workers make approximately 22% more than their non-union counterparts. Employees who unionize will most likely result in increased labor costs.
• Less control in hiring and termination: Unions base raises and promotions on seniority, not performance. It would be harder to let go of someone who has no work ethic but has 5 years of experience rather than promote someone who works 10 times as hard but only has 1 year of experience.
• Potential for lawsuits:  Increased probability of union support to appeal actions such as termination, lack of promotion, or other actions on an employee’s status.

The Starbucks Affect

Starbucks workers have been attempting to organize unions since the 1980s with no success. However, the first successful union happened in December 2021, when baristas in Buffalo, New York, won their first union election. With each location voting to unionize, Starbucks workers from across the country are connecting and sharing experiences, increasing the momentum of the unionizing effort. Their wins strike a positive moment for unions, especially in the food industry due to Starbucks’ high profile.

Starbucks has often been touted as being the leading brand in the restaurant industry for introducing new methods to keep engagement with guests. The most notable trend was making loyalty apps and online ordering a key component for quick-service restaurants.

Starbucks is one of the restaurant industry’s largest employers, with more than 350,000 workers on its payroll across 9,000 stores. Workers voting to unionize can create a domino effect for workers in other quick-service restaurant brands looking to receive some protection like wage increases, health benefits, and safety protocols that unions provide.

The Impact of Organized Unions on the Restaurant Industry

Starbucks isn’t the only quick-service restaurant brand facing the union wave. Voodoo Doughnut and Colectivo Coffee are also facing union activism from workers wanting more say in their jobs. Burgerville, a restaurant chain in Oregon, set history by creating the first fast-food labor contract in agreement with a union in December 2021.

Although these quick-service restaurant brands have agreed to form unions it is still a lengthy and challenging process. The union must write a contract with the company, the union and the company must agree on it, and then union members vote on whether they also agree. The process can take anywhere from six months to a few years and some may not end with a contract at all. Around 30 percent of unions don’t establish a contract within three years.

Other quick-service brands can see a union wave as workers are part of a younger generation that is more engaged in activism and social movements. The restaurant industry faces a more diverse workforce and a generation keen on advocating for better work livelihood and rights. A high-profile brand that leads the restaurant industry can be key to igniting change for other brands.

For a more detailed story on Starbucks and organized unions visit https://www.vox.com/recode/22993509/starbucks-successful-union-drive.