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Cath Everett

Sift Media

Freelance journalist and former editor of HRZone

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News: Starbucks’ move to cut staff benefits sparks fresh concern

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Starbucks’ decision to cut paid lunch breaks, sick leave and maternity benefits has sparked concern among staff that they are being forced to help subsidise the coffee chain’s potential tax bill increase.

According to the Guardian, on the same day last week that the House of Commons’ public accounts committee branded the firm’s tax avoidance measures as “immoral”, employees arriving for work were given the option of signing revised employment terms or leaving.
 
The changes, which will affect about 7,000 personnel across 750 stores in the UK, apparently include the removal of paid 30-minute lunch breaks and paid sick leave for the first day of illness.
 
Some staff will also experience pay freezes, while others will find that cash incentives for becoming manager or partner (or employee] of the year have been replaced with a plaque.
 
A bonus scheme for women returning to work after having a baby will also be cut as it is “not considered a valued benefit”. Even apparently minor benefits are being removed, with the practice of giving new mothers a hamper being replaced with a card and Starbucks baby grow and bib.
 
One worker told the newspaper that staff were “really upset” about the cuts, which their manager had told them was because Starbucks “is losing a lot of money in Europe, so they said they needed to make these changes to save the company money”.
 
Pay and conditions
 
But the source who asked to remain anonymous continued: “It’s really convenient for them to say we’re going to pay more taxes, when they’re going to save money with us, the staff. It’s convenient saying we’ll pay more because they’re going to save more – and the perfect excuse for them is to say to staff ‘we’re going to pay more taxes so…’”
 
But a Starbucks spokeswoman defended the contract changes, claiming that they were the result of several months of consultation with a group of employees and that “all partners were given the opportunity to feed back”.
 
She added: “That happened throughout the summer. It is entirely unrelated to the story that we are in discussions with HM Revenue & Customs and the Treasury.”
 
MPs on Monday said that they found it hard to believe the coffee chain’s claim that it had made a loss for 14 of the 15 years that it had operated in the UK, given that it had a 31% market share by turnover and had briefed shareholders that the UK business was generating profits of 15%.
 

***Starbucks saw protests outside of its head office in London yesterday, with members of the GMB union accusing it of failing to pay its staff the voluntary Living Wage, which is set at £8.55 in the capital and £7.45 elsewhere in the UK.

The union’s national equality officer, Kamaljeet Jandu, also described the coffee chain as being "an anti-social company" that was "a million miles away from empowering its staff and helping them exercise their rights to join a trade union and have it recognised", with workers being afraid of victimisation if they did so.

A spokeswoman for Starbucks said: "The decisions we have taken over the past few months have been about finding the right way to structure packages so that they are balanced across pay, benefits and development. Pay is one of a range of benefits that partners receive at Starbucks."

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Cath Everett

Freelance journalist and former editor of HRZone

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