Starbucks to pay $38.9m in NYC scheduling case
Starbucks has agreed to pay $38.9 million to settle a New York City probe that found the company violated local labor laws by failing to provide fast-food workers with predictable schedules more than half a million times over three years, Mayor Eric Adams’ office announced on Monday.
The settlement concludes a lengthy investigation into whether Starbucks broke the city’s 2017 Fair Workweek Law, which requires stable schedules, written consent for shift changes, and priority access to new shifts for existing employees. Adams’ office said the case marks the largest worker-protection settlement in the city’s history, News.Az reports, citing Reuters.
According to the settlement agreement dated Nov. 26, Starbucks frequently changed schedules without consent, reduced workers’ hours, and assigned shifts to new hires instead of current staff. Under the terms, the company will pay $35.5 million directly to more than 15,000 employees and $3.4 million in penalties and administrative costs.
In a statement, Starbucks said it supports the law’s intent but noted that compliance can be difficult in real-world situations. The company argued that even minor adjustments—such as shifting a start time by two hours—can count as violations, even when total hours and pay remain unchanged or when workers voluntarily cover for colleagues.
Affected employees will receive checks this winter, with each worker earning $50 for every week they held an hourly position between July 4, 2021, and July 7, 2024.
New York City was one of the first in the U.S. to restrict “on-call scheduling,” a practice widely used in retail and fast-food companies. Since then, similar laws have been adopted in Oregon, Los Angeles, Chicago, and San Francisco. Business groups continue to argue that such rules are burdensome and may lead to job cuts.
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