Coffee chain giant Starbucks (SBUX) has been urged by U.S. lawmakers to get around the table with union officials and avert a planned one-day strike later this week.
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According to a report from Reuters, a group of 26 U.S. senators and 82 House representatives has reportedly sent a letter to Starbucks CEO Brian Niccol, calling on the coffee giant to restart negotiations with its workers’ union.
“We have heard of a troubling return to union busting,” the letter from the group of senators led by Senator Bernie Sanders read. The lawmakers noted that the company should “bargain a fair contract in good faith with these employees.”
Talks between Starbucks and Starbucks Workers United, which represents roughly 9,500 workers, began in April last year but have since stalled. Both sides blame the other for ending talks and say they are ready to return to discussions.
Starbucks said in a statement the union represents only 4% of its workforce and that the company already offers “the best job in retail.” Starbucks offers employees who work at least 20 hours a week benefits including healthcare, parental leave, and tuition for online classes at Arizona State University.
Red Cup
The union is planning a one-day strike in 25 U.S. cities on Nov. 13.
The strike is being organized to take place alongside Starbucks’ annual holiday-themed “Red Cup Day” event. The union says it is deliberately targeting one of Starbucks’ busiest promotional events.
The strike is being called to bring attention to Starbucks’ refusal to negotiate contracts with the union and the workers it represents.
Niccol, who took on the top job in 2024, has sought to overhaul U.S. store operations in a bid to win back customers. However, some of those including cost-cuts and uniform changes have proved unpopular.
Starbucks sales, earnings and its share price have suffered in recent months as a result of more intense competition, consumers looking for cheaper options in a time of economic uncertainty and uninspiring food options.
However, hope is brewing with Starbucks reporting a 5% increase in global revenue in Q4 and a 1% rise in global comparable store sales, marking the first positive quarter in seven quarters.
Is SBUX a Good Stock to Buy Now?
On TipRanks, SBUX has a Moderate Buy consensus based on 13 Buy, 7 Hold and 2 Sell ratings. Its highest price target is $115. SBUX stock’s consensus price target is $96.11, implying a 12.32% upside.
