In a two-page letter to counsel, San Diego Superior Court Judge Patricia Cowett said the Seattle-based coffee company must pay baristas $86 million, plus interest, for using some of its employees’ tips to pay shift supervisors.A plaintiffs attorney in the case said the total judgment will exceed $100 million.Cowett’s Thursday ruling follows on her finding last month that the company was liable for sharing tips with managers such as shift supervisors. California’s tip-pooling law says that gratuities meant for hourly workers can’t be taken by an employer or its “agents” — and Cowett found that Starbucks supervisors were “agents.”
Plaintiffs attorney David Lowe asked the judge to award restitution and interest to a statewide class of about 120,000 baristas, or coffee servers, employed by the chain’s California branches since 2000. Based on expert testimony, Cowett pegged the average tip rate at $1.71 an hour and multiplied it by the 50,694,694 hours worked by shift supervisors.
It’s hard to fathom how those plastic boxes full of pennies could lead to a $100 million-plus verdict, but then again Starbucks has 6,793 company-owned stores and 3,891 joint-venture and licensed outlets in the U.S. alone (as of November 2007, h/t Wikipedia). I still remember Starbucks’ mantra of the 1990′s to have “2,000 stores by the year 2000.” I think they made it and then some.
This case does bring up some interesting issues regarding employment law. I’m not an expert in that field even in Texas, and I am puzzled by the sheer size of the judgment–still, it seems to be a proper vindication of the rights of a traditionally-underpaid, under-appreciated part of the workforce (i.e. food servers).
The lawsuit was filed in October 2004 by Jou Chou, a former Starbucks barista in La Jolla, who complained shift supervisors were sharing in employee tips.The lawsuit gained ground in 2006 when it was granted class-action status, allowing for the suit to go forward for as many as 100,000 former and current baristas in the coffee chain’s California stores.
It was not immediately clear how many current and former employees are affected by the ruling.
“I feel vindicated,” Chou said in a written statement released by attorneys. “Tips really help those receiving the lowest wages. I think Starbucks should pay shift supervisors higher wages instead of taking money from the tip pool.”
California is Starbucks’ largest U.S. market, with 2,460 stores as of Jan. 8, the latest count available. The company has more than 11,000 stores nationwide.
Starbucks employs more than 135,000 baristas in the U.S. The company did not immediately respond to a request for a head count in California.
I’m looking for a copy of the actual letter from the judge–the court hasn’t posted it, but I’ll keep looking.