Starbucks Ordered to Pay More Than $100 Million in Back Tips

Oh boy ...

SAN DIEGO — A Superior Court judge on Thursday ordered Starbucks Corp. to pay its California baristas more than $100 million in back tips and interest that the coffee chain paid to shift supervisors.

San Diego Superior Court Judge Patricia Cowett also issued an injunction that prevents Starbucks' shift supervisors from sharing in future tips, saying state law prohibits managers and supervisors from sharing in employee gratuities.

Starbucks spokeswoman Valerie O'Neil said the company planned an immediate appeal of the ruling, calling it "fundamentally unfair and beyond all common sense and reason."

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Comment by Jason Dominy on March 21, 2008 at 12:15pm
Wow. This is very interesting, and although I am sure it may just be a CA thing, it could have ramifications all over.....We'll tune in to see. (I have to admit part of me grinned when I saw the title of the post in light of the past week's developments. I won't lie.)
Comment by Matt Milletto on March 21, 2008 at 10:36am
Comment by Brian Muller on March 21, 2008 at 10:23am
There is a better story about it in the Law section of Wall Street Journal online. Also has been some very intelligent comments posted.

The decision primarily comes down to this. The California Labor Law says about tip pooling that "management or it's agents cannot participate" The judge ruled that a shift supervisor is an agent of management. Even if they do all the same work but has been put in charge over the other employees. Here is the possible effect. Anyone who is deemed in charge over other employees cannot participate in tip pools. WOW! This ruling could have far reaching effects.

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