Services

Starbucks Announces 100% Pay Equity: Men and Women Both Paid Poorly

Douglas A. McIntyre

Published: March 22, 2018 6:40 am

Last Updated: January 12, 2020 2:12 am

Female workers make, on average, three-quarters of what men do when performing similar jobs. In some quarters, the disparity is much worse. Starbucks Corp. (NASDAQ: SBUX) announced it has bridged the gulf. Its management said there is pay parity for men and women, and among all races, who are Starbucks employees.

In comments made at Starbucks annual meeting, Lucy Helm, chief partner officer at Starbucks said:

Today, I am so pleased to share that we as a company have achieved a major milestone: 100 percent pay equity for women and men and people of all races performing similar work across the country. It’s an emotional moment for me as a 19-year partner and a leader.

What was left unaddressed is that Starbucks is among the lowest paying companies in America, particularly for its retail employees.

In an analysis of American companies, 24/7 Wall St. found that Starbucks pays lower wages than almost any other public corporation. The analysis, “Companies Paying Americans the Least” published late last year, found that among 25 companies mentioned, Starbucks had the sixth lowest pay:

Service industry jobs are among the lowest paying in the United States, and Starbucks is one of the largest service industry employers in the country. Nationwide, the company employs some 170,000 people. According to Glassdoor, the typical Starbucks barista makes less than $10 an hour.

As is almost always the case, low pay is not an issue for corporate leadership. Starting in October 2017, former Sam’s Club CEO Rosalind Brewer will take over as Starbucks’ chief operating officer. Brewer will enjoy a $1 million signing bonus in addition to $7 million equity bonus and a $1 million base salary. Including benefits, Starbucks’ new second in command will make over 430 times the amount of a barista working full time in her first year.

In 2017, according to the Starbucks proxy, founder and Executive Chairman Howard Schultz made $18.0 million. CEO Kevin Johnson made $11.5 million.

Equal pay for equal work may be a hallmark of Starbucks human resources goals, but its lowest level workers are still paid poorly.