Starbucks Agrees to $38.9M Settlement Over NYC Fair Workweek Violations

Starbucks to Pay $38.9 Million in Record NYC Settlement Over Fair Workweek Violations

Starbucks has agreed to pay $38.9 million to settle allegations brought by the New York City Department of Consumer and Worker Protection (DCWP) that the company repeatedly violated the city’s Fair Workweek Law across approximately 300 locations. The consent decree represents the largest worker-protection settlement ever reached with a single employer in New York City history.

Of the total amount, $35.5 million will be distributed directly to more than 15,000 affected employees, while $3.4 million will be paid to the city as civil penalties.

The DCWP’s investigation, launched in 2022, found that Starbucks’ scheduling practices resulted in roughly 500,000 cumulative violations. Employees were denied stable and predictable schedules and were routinely prevented from picking up additional shifts. The agency stated that workers “never received regular schedules,” making it nearly impossible to arrange childcare, education, or second jobs. Starbucks also allegedly reduced workers’ hours by more than 15% without justification on a frequent basis and barred certain employees from taking extra shifts, preventing part-time staff from accumulating sufficient hours to qualify for full-time status.

New York City’s Fair Workweek Law requires fast-food employers to:

• Provide fixed schedules at least 14 days in advance;
• Offer available shifts to existing employees before hiring new workers;
• Allow laid-off employees to transfer to other locations within the chain;
• Prohibit termination without just cause and bar weekly hour reductions exceeding 15%.

Most hourly Starbucks workers in New York City will receive $50 for each week worked between July 4, 2021, and July 7, 2024.

Lynne Fox, International President of Workers United (the parent union of Starbucks Workers United), welcomed the settlement, stating: “For far too long, Starbucks has acted with impunity—manipulating schedules, disrespecting workers, and flouting legal protections that New Yorkers put in place to shield working people from unfair business practices. This agreement shows the city is finally holding the company accountable.”

Since Mayor Eric Adams and DCWP Commissioner Vilda Vera Mayuga took office in 2022, the city has secured more than $90 million in worker relief through DCWP enforcement actions, with the bulk coming from just two cases: the current Starbucks settlement and a $20 million agreement with Chipotle in 2022.

The settlement comes amid an escalating nationwide strike by unionized Starbucks baristas that began in mid-November and has grown from 65 stores to more than 120 locations across dozens of cities. Regulatory scrutiny in New York may intensify further: Mayor-elect Zohran Mamdani appeared on a union picket line outside a Brooklyn Starbucks on Monday, according to a statement from Starbucks Workers United.