The long-standing labor dispute between coffee chain Starbucks (SBUX) and Workers United, a union representing over 10,000 baristas, has taken a major turn with the mutual withdrawal of lawsuits filed by both parties. Importantly, the move came just a day after a mediator was brought to help with the negotiations.
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Here’s a Brief Recap of SBUX and the Unions’ Dispute
The negotiations between Starbucks and Workers United began in April 2022, with the union seeking better working conditions, wages, and benefits. After months of negotiations, failed bargaining attempts, and escalating legal battles, the negotiations stalled in December 2023 due to disagreements and slow progress.
Further, the union went on a five-day strike over the holiday period, temporarily shutting down outlets in cities like Los Angeles, Chicago, and Seattle. Following this strike, Starbucks sued the union, alleging misuse of company trademarks in union campaigns. Workers United responded by filing a complaint with the National Labor Relations Board, accusing SBUX of unfair labor practices.
A Win-Win for Starbucks and Workers United
The settlement between Starbucks and the union represents a significant shift in their approach. Rather than escalating conflicts through legal battles, both parties have opted for negotiation.
For Starbucks, this settlement could help repair its public image, which has been affected by the union’s allegations. For Workers United, focusing on contract negotiations provides a more effective path toward securing improved working conditions for its members.
Importantly, the latest development points to the growing influence of labor unions in the service industry. As workers increasingly demand better wages, benefits, and job security, unions are playing a crucial role in advocating their rights.
Is SBUX a Good Stock?
Wall Street remains optimistic about Starbucks stock. On TipRanks, SBUX stock commands a Moderate Buy consensus rating based on 15 Buys, five Holds, and two Sell recommendations. Also, the average Starbucks price target of $109.10 implies a modest 1.32% upside potential from current levels. Shares of the company have gained 11.67% in the past three months.
