Starbucks workers win store-by-store union vote as investors bail on

Starbucks workers, hoping to organize a union at three Buffalo, New York, cafes, scored a victory Thursday, even as the company faced pushback from investors over plans to raise wages next year.

On Thursday, the National Labor Relations Board sided with workers, who were looking to hold a vote to organize at three specific locations. Starbucks had been hoping to open voting to the entire Buffalo market in a single ballot. The decision means three separate unit elections will take place at the stores, with mail-in ballots due on Dec. 8, and a vote count on Dec. 9. More than 100 workers are eligible to vote.

If workers vote in favor of organizing, it will mark the first successful attempt at unionization for the coffee giant in the U.S. and could make waves in the industry.

Starbucks Workers United, the group organizing the vote, cheered the decision.

“Partners won. With this decision, the partners in Buffalo have the ability to win the very first union Starbucks store in the U.S.,” said Richard Bensinger, organizing director, in a statement to CNBC.

The NLRB decision came the same day Starbucks told investors that fiscal 2022 earnings would be lower than analysts were predicting. The company blamed both the ongoing impact of the Covid-19 pandemic as well as rising costs, which include wages.

On Wednesday, Starbucks announced it would be raising pay for workers based on market and tenure. By summer 2022, its pay floor will be $15 an hour, with an average hourly wage of $17 an hour, up from the current average of $14.

Starbucks shares tumbled more than 7% Friday as investors reacted to the slower profit growth ahead.

Restaurants have been raising wages in recent months, in an attempt to woo workers back to the industry. A labor shortage has reduced sales, as restaurants have had cut back on hours and scale back service. Meanwhile, workers are flexing their newfound clout, and there has been a pick up in labor union activity.

Bensigner said the pay bump is a positive for workers, but the movement is about more than money.

“I think they underestimate why people organize a union — not like people have a price in their head. It isn’t one issue or money. Simply if we have a real partnership, why don’t we have a union?” he said.

Starbucks is known for calling its employees “partners” and touting that it has among the most progressive benefits in the fast food and restaurant space. It has been encouraging workers not to vote to unionize over the last few months. Executives including Rossann Williams, executive vice president of North Americas, and Howard Schultz, its former CEO, went to Buffalo to hold listening sessions with workers in September.

In a statement Thursday, Starbucks said it was reviewing the NLRB ruling and evaluating its options.

“We remain focused on supporting our partners as well as maintaining open,…