When former Starbucks CEO Howard Schultz told an unhappy barista that they could ‘work for another company,” if they weren’t happy where they were, he was breaking the law, according to a ruling by the National Labor Relations Board. According to the NLRB, Schultz’s statement represented an “unlawful, coercive threat.” Apparently said with an “angry expression on his face,” the NLRB decision upholds a previous administrative law judge’s decision in October 2023. The outburst from Schultz reportedly came at an event in Long Beach, California, where he was addressing improving working conditions at Starbucks stores. Barista, Madison Hall, attempted to bring up what she described as the benefits of unionization and Starbucks’ alleged history of unfair labor practices, according to the NLRB. Schultz asked her: “Why are you angry at Starbucks?” He said the event wasn’t the place to discuss union issues, then made the remark about working elsewhere. In a statement, Starbucks said it disagrees with the board’s decision: “Our focus continues to be on training and supporting our managers to ensure respect of our partners’ rights to organize and continuing to make progress in our discussions with Workers United,” a company spokesperson said. Though Schultz stepped down in March 2023 after his third time serving as CEO, he remains tied to the company. When he retired from the Starbucks board of directors last September, the company gave him the title of “lifelong chairman emeritus.”
$30,000 offer for staff to quit gets 8% uptake at Automattic
Matt Mullenweg, CEO of Automattic (which runs WordPress), has seen 8.4% of his employees quit, after he offered them $30,000 to leave if they didn’t agree with the direction he was taking the company. Mullenweg, who co-created WordPress, has been embroiled in a two-week skirmish with web hosting provider, WP Engine, accusing it of wrongfully using the WordPress and WooCommerce trademarks. In response, WP Engine filed a lawsuit against Automattic and Mullenweg, accusing the company and its CEO of “abuse of power,” and extortion, and saying the WordPress co-creator has conflicts of interest in handling WordPress as an open-source project. In response to what employees could do if they didn’t like what was happening, more than 8% of employees left when the boss offered them $30,000, or six months’ salary (whatever was higher), to quit. Nearly 80% of people who took him up on the offer worked in the company’s Ecosystem/WordPress division. Mullenweg tried to put a positive spin on it, saying “HR added some extra details to sweeten the deal; we wanted to make it as enticing as possible.” He added: “159 people took the offer, 8.4% of the company, the other 91.6% gave up $126 million of potential severance to stay!”
Bank of America has been embroiled in an internal dispute between two staff affinity groups’ plans to remember the 7th October anniversary of the terrorist massacre of Jews a year ago this week. Last week, a corporate-resource (or affinity group), called the Arab Executive Advisory Council called on its members to join a virtual meeting at work and “observe a moment of silence with each other to remember the tragic loss of life on Oct. 7 and since then.” The bank’s other affinity group, the Jewish Executive Advisory Council, had planned their own Oct 7 gathering to “remember the tragic loss of life” and took issue with the “since then” language used – which they said implies criticism of the Israel’s ongoing military response. Jewish BofA employees reportedly alerted senior executives that a bank-approved group was in their view seeking to counter their commemoration of one of the worst massacres of Jews since the Holocaust. Ethnic affinity or resource groups at major corporations have grown in recent years as companies increasingly embraced DEI policies. Yet they are controversial as critics say they can sow divisiveness and sap employee morale.
The ‘independent contractor or employee?’ saga that has dogged Uber and Lyft for the last decade has taken yet another twist, after the Supreme Court this week declined to hear a challenge by the gig economy companies to lawsuits by the state of California that claim Uber and Lyft owe money to drivers misclassified as independent contractors rather than employees. California is one of several Democratic-led states that have accused Uber and Lyft of depriving drivers of minimum wage, overtime pay, reimbursements for expenses and other protections by labeling them as independent contractors. California filed separate lawsuits against the companies in 2020. A state appeals court in 2023 ruled against the companies in their challenge to the lawsuits. The California Supreme Court subsequently declined to hear their appeals. Theane Evangelis, a lawyer for Uber, in an emailed statement maintained that the California court’s ruling was incorrect, and said the Supreme Court could decide the issue in a future case.
US employers smashed expectations by adding a substantial 254,000 jobs in September, comfortably beating predictions of gains of around 145,000. In fact, job growth in the US reached its highest level in six months – high enough to cause the official unemployment rate fall to 4.1%. The robust employment gains defied weak labor market sentiment from the Institute for Supply Management. Hiring at restaurants and bars, which increased by 69,000 jobs, lead the nearly broad rise in payrolls. The healthcare sector added 45,000 positions, driven by home healthcare services, hospitals as well as nursing and residential care facilities. Government employment increased by 31,000 jobs, lifted by state and local government hiring. Estimates for September’s job gain had ranged from 70,000 to 220,000. Analysts now argue the economy is strong enough to reduce the need for the Federal Reserve to implement large interest rate cuts this year. The three-month average of monthly job growth increased to 186,000 from 140,000 in August. In addition to the better-than-expected rise in nonfarm payrolls reported by the Labor Department on Friday, wages also increased at a steady pace last month. “Today’s report reinforces the broad resilience theme for the U.S. economy, pushing aside concerns of an imminent deterioration in labor market conditions,” said Jonathan Millar, a senior economist at Barclays.
Online behemoth, Amazon, has announced it will be hiring 250,000 workers – mainly those in transportation and warehousing – as it gears up for the busy holiday season. Each year, commentators wait for the festive hiring plans of the nation’s biggest employers to gauge consumer – but more crucially, employer confidence. This year’s figure is around the same as last years,’ but Amazon claims spending is likely to outperform last year. “Although there is an anticipated increase in the demand and the volume [of online shopping], we feel like the 250,000 is the right number to continue to grow and advance with our operations,” said Sandy Gordon, vice president of global operations employee experience at Amazon. Online holiday shoppers are expected to spend a record $240.8 billion this year – which is up 4.9% compared to last year. Broader holiday spending is expected to rise modestly at 3.2%, according to a Mastercard forecast. All-told US retailers are expected to add 520,000 new jobs during the holiday shopping season, slightly down from last year’s 564,200 job openings.
US dock workers have reportedly reached a tentative agreement with port operators that will immediately end a crippling strike that last week shut down much of the shipping of the east coast. After previously rejecting a deal worth more than 40% over six years, the new agreement sees workers achieve a 62% pay hike over the same time period. This will raise average wages to around $63 an hour, up from from the current $39 an hour over the life of the contract. The International Longshoremen’s Association (ILA) workers union had been seeking a 77% raise while the employer group, United States Maritime Alliance (USMX), had previously raised its offer to a nearly 50% rise. The union and the port operators said in a statement that they would extend their master contract until January 15th 2025 to return to the bargaining table to negotiate all outstanding issues. “The decision to end the current strike and allow the East and Gulf coast ports to reopen is good news for the nation’s economy, National Retail Federation said in a statement. “The sooner they reach a (final) deal, the better for all American families.”
