Latest
Recommended
Published: Tue, July 12, 2016
Economy | By Melissa Porter

Starbucks to increase base pay of workers in October

Starbucks to increase base pay of workers in October

Starbucks Corp. (SBUX) said that, effective October 3, all partners and store managers in USA company-operated stores will receive an increase in base pay of 5% or greater.

In a letter to employees Starbucks" chief executive, Howard Schultz said the company was looking to "strike a balance' between profit and social responsibility.

The raise applies to workers in Starbucks' 7,600 company-operated stores, but not in the nearly 5,000 licensed locations operated by other companies. Additionally, Starbucks will double stock rewards for employees now offered through its Bean Stock program.

Starbucks will also add a future annual enhancement to Bean Stock, its stock compensation program. The wage hike reinforces Schultz's longstanding commitment to investing in his employees' success, and it positions Starbucks as a key player in the biggest economic story in America today. Specifically, the company will be doubling the annual bean stock award for partners that reach two years of continuous service with the company.

Employees at Starbucks over 4,900 licensed stores in the USA appear to be out of luck. For one thing, new minimum-wage laws will be taking effect in places throughout the country in the next few months, and Starbucks will need to not just be complaint with the law, but to be competitive. As a minimum noted 5%, as a maximum 15%.

Starbucks will be raising the base pay of its workers this fall, Money reports. That effort has helped spur pay raises at companies like McDonald's, as well as minimum wage increases in major cities and states.

Starbucks didn't indicate how much the pay increases would cost. The average annual wage came to almost $20,000, including tips, company stock, and other bonuses, according to the website.

Starbucks products are also going up in price, with some beverage increasing by as much as 30 cents.

Mr. Schultz also explained in his letter that some of the working hours of its employees change particularly during summer because of the change in customer routines.

The company has made progress over the years in providing more stability and consistency in scheduling and field leaders are committed to meeting scheduling needs, he said, especially when it comes to ensuring benefits eligibility.

Like this: