Supreme Court considers Starbucks’ challenge to labor board’s authority

A Starbucks challenge to the National Labor Relations Board’s reinstatement of fired baristas will go before the Supreme Court on Tuesday.

In 2022, Starbucks fired seven baristas, who were organizing a union at their Memphis coffeehouse. The Seattle-based coffee giant says their move was within their rights under the law, because the workers violated company policy by inviting a TV news crew into the store after hours.

But the National Labor Relations Board agreed with the workers’ claim that Starbucks had fired them for their union activity. A federal judge then approved the agency’s request for an order that Starbucks reinstate the workers. An appeals court upheld that decision.

The case arrives before the Supreme Court as Starbucks appears to have taken a new, more cordial tone, agreeing to talks with the local union that could pave the way to the first labor contracts for stores that have already unionized. The company and the union resume bargaining this week, following a breakdown in talks months ago, with a goal of withdrawing ongoing litigation.

However, the case continues before the Supreme Court because Starbucks is disputing the standard that federal judges use to determine whether workers should get their job back, when requested by the National Labor Relations Board.

While the Supreme Court will examine the power of the NLRB around the workers’ reinstatement, experts fear a ruling against the NLRB could weaken labor organizing in other scenarios. For example, the labor board can also request that a federal judge require that a company bargain with unionized workers, reopen closed stores or provide other remedies to rectify unfair labor practice charges.

“This could have a substantial impact,” said James Cooney, a labor studies professor at Rutgers University. “If a stricter standard is adopted by the Supreme Court, it’ll be more difficult for the labor board to maintain the status quo for workers during an organizing drive. If there have been terminations of pro-union workers, those people are going to be out of work for years.”

Starbucks is arguing that the federal courts should use a stricter standard when it comes to going over the company’s head to reinstate fired workers. The company said that the federal district court wrongly relied on “a minimal standard” for approving the request to reinstate the Memphis workers rather than what it says is a tougher “four-factor” test used by courts in other regions of the country.

Kathleen McKinney, a regional director for the National Labor Relations Board, Starbucks’s opponent in the case, has argued that the courts already apply a consistent formula for granting relief that has been adapted to labor law and considers the same factors across circuits.

A decision in the Starbucks case could make it tougher for the NLRB to obtain relief for labor activists ― which could have a chilling effect on union drives during a period of heightened union activism in the United States. The Supreme Court has consistently ruled in favor of employers and corporate interests, including in a 2023 decision to make unions more liable for financial losses attributable to work stoppages.

President Biden’s appointed leader of the labor board, Jennifer Abruzzo, has earned a reputation for taking an aggressive approach to defending workers’ organizing rights. In 2022, she urged the agency’s staff to request relief from courts in “earliest phases of unlawful employer anti-union actions.”

Meanwhile, pro-business groups, including the HR Policy Association and the U.S. Chamber of Commerce, have rallied in support of Starbucks’s argument that the current process for granting relief is too lenient and stacked against employers.

The “watered-down approach” for obtaining relief has become “a cudgel that the Board has wielded against American businesses with increasing frequency in recent years,” the Chamber wrote in a brief filed with the Supreme Court in support of Starbucks.

Twelve current and former Starbucks baristas from around the country wrote to the Supreme Court that they had all either been fired or retaliated against for supporting union drives - losing their health insurance and having their electricity turned off because they couldn’t pay bills.

The baristas are “united in their conviction” that relief from the courts “is critical to preventing employers from illegally suppressing attempts to improve working conditions,” they wrote.

More than 400 of the company’s 9,600 company-operated U.S. stores have voted to unionize with Starbucks Workers United since the campaign went public in 2021.

Union officials expressed disappointment that Starbucks has forged ahead with its Supreme Court case.

Lynne Fox, president of Workers United, Starbucks’s workers parent union, told The Washington Post that “the day [Starbucks] committed to a new path should’ve been the day that they pulled back the case before SCOTUS.”

And the National Labor Relations Board is facing other, more drastic legal challenges to its authority. SpaceX filed a lawsuit in a federal court in Texas earlier this year claiming that the agency’s structure is “unconstitutional” after the Labor Board issued a complaint against the space rocket company alleging it illegally fired eight employees for criticizing the company’s leader Elon Musk.

Starbucks, Amazon and Trader Joe’s have since echoed SpaceX’s argument in legal proceedings at the Labor Board.

Abruzzo, the labor board’s chief,, has slammed these corporate challenges. At a panel earlier this month, she called the companies “deep-pocket, low-road employers” who are trying to divert the agency from its mission to defend workers’ rights “because they have the money to do so.”