Starbucks Offers Executives Up to $6 Million in Incentives Amid Union Wage Negotiations

Starbucks has announced a significant incentive plan for its executives, offering up to $6 million in stock grants to those who successfully meet the cost-saving and timely rollout goals of the company’s “Back to Starbucks” turnaround strategy. This move comes as baristas, represented by Starbucks Workers United, are negotiating for annual wage increases above 2%.

The coffee chain's new CEO, Brian Niccol, introduced the “Back to Starbucks” plan to return the company to its roots, focusing on customer experience and efficiency. The performance-based incentive is designed to motivate and retain senior leaders to achieve key components of the turnaround plan, including the rollout of the Green Apron Service program, new food and beverage platforms, and a reimaged Starbucks Rewards program. Executives can unlock a payout of up to 200% of the target if they meet the performance goals by the end of Starbuck’s fiscal 2027.

Niccol's leadership has brought about several changes, such as a green apron dress code, hand-written order names, and a revamped hiring process to improve store staffing. Despite these efforts, baristas have expressed dissatisfaction with their wages. In 2024, baristas received smaller pay increases of about 2% to 3%, compared to the 3% to 5% increase from previous years. The average hourly wage for baristas is $19, totaling about $30 when benefits are included.

Unionized baristas have been negotiating a new contract with management for two years, rejecting a company proposal that guaranteed at least a 2% pay increase annually. Jasmine Leli, a barista and bargaining delegate with Starbucks Workers United, criticized the $6 million incentives for executives, stating that the company cannot claim there is no money for a fair union contract while allocating millions for executive bonuses and conferences. Leli emphasized that the success of the “Back to Starbucks” strategy depends on the well-being of baristas, who are crucial to the customer experience.

More than 2,000 Starbucks baristas at 120 U.S. stores went on strike in May, protesting the new dress code and advocating for better staffing, guaranteed hours, improved take-home pay, and on-the-job protections. Despite Niccol's efforts to decrease wait times, baristas continue to struggle with understaffing and high traffic volumes, making it difficult to efficiently prepare drinks. The company has responded by encouraging the union to return to the negotiating table and focus on productive discussions rather than protests.