Key facts
- Shareholder groups filed a proposal asking Starbucks' board to reinstate a dissolved committee that oversaw labor relations.
- The proposal highlights the absence of a labor agreement with the union representing US baristas nearly five years after workers first organized.
- The filers collectively hold nearly $270 million of Starbucks shares.
- Starbucks stated it is confident the board has the necessary skills to oversee its strategy.
- The company's shares are up 13% this year.
- Starbucks paid a $38.9 million settlement to New York City over alleged staff-scheduling violations.
Starbucks is facing renewed pressure from shareholder groups, including New York City's comptroller, who have filed a proposal demanding the reinstatement of a committee dedicated to overseeing labor relations. This move comes amid a protracted lack of a formal labor agreement with the union representing US baristas, a situation that has persisted for nearly five years since the first store unionized in Buffalo, New York.
The proposal, also supported by the New York state comptroller and Trillium Asset Management, highlights the ongoing labor issues as one of Starbucks' "most significant and persistent risk areas." Jonas Kron, chief advocacy officer at Trillium Asset Management, stated that the board would function better with a dedicated committee to address such specific risks, particularly under CEO Brian Niccol's tenure.
Collectively, these filers hold approximately $270 million in Starbucks shares. Starbucks, whose shares have risen 13% this year, responded by expressing confidence in the board's ability to oversee its strategy. The company previously had an Environmental, Partner and Community Impact Committee established in 2023, but it was dissolved in November 2025, with its responsibilities redistributed to the broader board for what the company termed "stronger and more integrated" oversight.
Previous attempts by some of these shareholder groups to unseat directors over the committee's dissolution were unsuccessful. However, shareholder proxy advisers had previously warned investors about potential risks linked to Starbucks' labor relations, including strikes and a $38.9 million settlement paid to New York City for alleged staff-scheduling violations. The union has also actively campaigned for a boycott until a contract is reached.
Beyond Wall Street, Starbucks has faced international scrutiny, with UN human-rights experts urging action on allegations of an anti-union campaign. US lawmakers have also called on the company to reach a labor agreement. In contrast, Blue Bottle Coffee recently ratified a first contract with its unionized baristas.