Starbucks’ former chief executive Howard Schultz will be returning to lead the company for a third time, taking over as the interim chief executive and driving strategy to deal with unionization efforts across its U.S. store locations.
Schultz will be taking over the reigns from CEO Kevin Johnson, who will be retiring after spending 13 years with the company, the last five as its chief executive.
Johnson is credited with steering the company’s business through the thick of the pandemic when Starbucks was forced to shutter stores. However, the company’s business quickly recovered due to its ability to handle the surge in mobile ordering. Under Johnson’s leadership, the coffee giant has also made efforts to retain workers by paying them higher hourly wages. By the summer of 2022, the company plans to pay workers $15 to $23 per hour.
Still, Starbucks has been dealing with growing protests from its workers, who have accused the company of not doing enough to protect them during the pandemic — a sentiment that has triggered unionization efforts across several states.
The company’s efforts to bust unionization have seemingly backfired. On Tuesday this week, a federal labor board called out the company for unlawfully retaliating against two Arizona employees, who tried to form a union at their store location, Reuters reported. The same day, a group of company investors urged Starbucks to stop sending out anti-union communications to its employees and instead take a neutral stance toward unions.
While it remains to be seen whether Schultz will be able to solve Starbucks’ unionization problems, he does not have the best track record for dealing with it.
In November last year, Schultz reportedly compared Starbucks’ pro-employee stance to Holocaust prisoners sharing blankets in concentration camps at a large meeting with employees in Buffalo, New York, where several Starbucks locations were considering forming a union.
His remarks led to an instant backlash on social media.
“Schultz came to Buffalo to union-bust,” wrote union organizer and barista Jaz Brisack on Twitter after the news on Wednesday. “His takeover is another move in Starbucks’ ideological war on unions.”
Schultz’s return to the company has so far been well received by analysts and the stock market.
“Schultz is a revered leader and uniquely well-qualified to steward” the company, said Credit Suisse analyst Lauren Silberman.
The company’s stock went up by 4.8% after the news broke.