Starbucks Agrees to Largest Worker-Protection Settlement in NYC History

Starbucks will pay $39 million to settle charges that it violated New York City’s predictive scheduling law.

The coffee company will pay some 15,000 affected workers $35.5 million in restitution payments ranging from $50 to $3,900 per worker and an additional $3.4 million in civil penalties. Officials said it is the largest worker-protection settlement in the city’s history.

New York City’s Fair Workweek Law requires covered fast food employers like Starbucks to provide workers predictable, regular work schedules, advance notice of changes in schedules, the right to decline schedule changes, “predictability pay” for changes to work schedules, and more. Similar laws are in effect in Chicago, Los Angeles, San Francisco and several other localities.

The City found that Starbucks had violated the law more than half a million times since 2021 by failing to provide regular schedules, by reducing employees’ work hours without their consent and by failing to offer available shifts to current employees before hiring new employees.

“With this landmark settlement, we’ll put tens of millions of dollars back into the pockets of hard-working New Yorkers and reinforce every New Yorker’s right to a reliable schedule, full hours, and basic dignity,” Mayor Eric Adams said.

Although it supports the intent of the law and is committed to complying, Starbucks said the law’s complexity creates real-world challenges. For example, if an employee who normally works 20 hours a week calls out for three scheduled hours and their store asks someone else to cover that time, that could be considered a violation. “The law treats almost any adjustment as a potential issue – even starting a shift two hours later than planned, even if the total hours and pay stay the same.”

A restaurant industry group also criticized the law. “The Fair Workweek law is notoriously complex and difficult for restaurant operators to comply with, even when trying in good faith,” Kevin Dugan, a lobbyist for the New York State Restaurant Association, said in a statement. “While well-intentioned, the law creates a nearly insurmountable burden to maintain consistent work schedules in the face of changing business demands, unforeseen employee absences and many other staffing issues common in the restaurant business.”