Core Points - Thousands of baristas are striking on Red Cup Day, aiming to finalize their first contract with Starbucks amid ongoing labor negotiations [1][2][5] - The strike involves over 65 stores across 40 US cities, disrupting a major sales promotion that typically sees a significant increase in customer visits [2][3] - The union has organized multiple strikes since 2023, with the current work stoppage being the fourth and the third since the new CEO took over [3][4] Labor Relations - Baristas have been attempting to ratify their collective bargaining agreement since December 2021, but negotiations collapsed in December 2022 [5][6] - Starbucks claims the union walked away from negotiations, while the union insists it is ready to bargain and is awaiting new proposals from Starbucks [6][7] - The union has reported increased interest in joining since Starbucks' recent restructuring, which involved closing over 600 stores and laying off thousands [7][8] Regulatory Environment - The National Labor Relations Board (NLRB) has been understaffed, causing delays in union elections and leaving some baristas without full protections under labor laws [9][10] - The lack of sufficient NLRB staffing has hindered the ability of new stores to unionize, complicating the labor landscape for Starbucks [11] Shareholder and Legislative Pressure - Shareholders and lawmakers are increasingly concerned about labor tensions affecting Starbucks' turnaround efforts, with over 100 lawmakers urging the company to negotiate fairly [13][14] - A group of shareholders has expressed worries about the impact of labor disputes on the company's reputation and stock price, which has declined over 5% this year [15][16] - The company's recent fiscal report indicated a 1% increase in Q4 comparable sales globally, marking the first sales increase in seven quarters [15]

Core Viewpoint - Long-term shareholders of Starbucks are urging the company to resume negotiations with its workers' union regarding staffing, wages, and other labor issues, highlighting concerns over deteriorating labor relations and the lack of a contract agreement since the first successful union election over three years ago [1][3][5]. Group 1: Shareholder Concerns - The letter from shareholders, including the New York City Comptroller and various investment firms, emphasizes the significant deterioration in Starbucks' labor relations, citing over 100 Unfair Labor Practice complaints filed this year, partner walkouts, protests, and strikes [3][4]. - The New York City pension funds, as the largest shareholders in the group, hold approximately 1.33 million shares of Starbucks [4]. Group 2: Union Relations - Talks between Starbucks and the union, representing over 12,000 baristas, began in April of the previous year but have stalled, with no contract agreement reached despite three years since the first successful union election [4][5]. - Union members staged multi-day strikes during the peak holiday season in December, indicating ongoing tensions between the union and management [4]. Group 3: Company Actions - Starbucks is implementing a $1 billion restructuring plan under CEO Brian Niccol, which includes closing underperforming stores, such as its flagship unionized outlet in Seattle [8][9]. - Currently, there are over 650 unionized Starbucks stores in the U.S., with the first successful unionization occurring in Buffalo, New York, in December 2021 [8].