Starbucks to Raise Employee Wages in Wake of Trump’s Tax Reform
Starbucks is raising wages and offering a new round of benefits for its employees in a move the company’s CEO says was accelerated by President Donald Trump’s tax reforms.
Salaried partner employees will receive a round of raises in April this year, Starbucks CEO Kevin Johnson said Wednesday, according to Business Insider. The raise will be the second one for the year. Starbucks employees already received an annual wage hike in January.
The company is investing a total of $120 million to raise pay. The actual amounts of the raises vary by location, based on factors like local cost of living and local minimum wage.
Starbucks is also offering a new round of benefits meant to address a gap between corporate and in-store workers. The company received backlash last year over a paternal leave policy that benefited corporate workers but left out in-store employees.
“It’s a poverty wage,” California Starbucks shift supervisor Jaime Prater wrote in a blog post. “Living off of this income isn’t just implausible, it’s impossible. It’s not livable under any circumstances.”
“I don’t know how many times I’ve heard that we’re the most important part of the company,” another employee told Business Insider. “If we’re the most important part of the company and our connection is that important, [they shouldn’t be] paying as little as they can get away with paying.”
Starbucks is also allowing full-time and part-time workers to accrue paid sick leave and use it to care for ailing family members or for themselves in case of sickness.
Starbucks is joining a wave of corporations which have announced cash bonuses, pay raises and other benefits for their employees as a result of Trump’s tax reform.
On Tuesday, The Walt Disney Co., Verizon Wireless, and JPMorgan Chase & Co. announced tax-reform based bonuses, pay raises, benefits and stock grants affecting more than 300,000 employees. According to Americans for Tax Reform, more than 2 million workers have already received, or are set to receive, cash bonuses as a direct result of Trump’s tax reform.
Republicans secured the passage of the president’s tax reform passage against total opposition from Democrats, who did not cast a single vote for the bill. The tax cut dropped the corporate tax rate to 21 percent, resulting in a cash windfall for U.S. businesses.
“Tremendous investment by companies from all over the world being made in America,” Trump wrote on Twitter on Wednesday. “There has never been anything like it. Now Disney, J.P. Morgan Chase and many others. Massive Regulation Reduction and Tax Cuts are making us a powerhouse again. Long way to go! Jobs, Jobs, Jobs!”