Starbucks reiterated Thursday that its outgoing CEO Howard Schultz is not the right person to testify on behalf of the company at a congressional hearing requested by Sen. Bernie Sanders, I-Vermont. Despite being the public face of the Seattle-based coffee giant, the company said Schultz hasn't been involved in making decisions regarding union matters.
Schultz, who is leaving the job this month, has been focused on the Reinvention plan since he returned as CEO last April and has delegated union issues to a small group of executives, according to a letter written by Starbucks general counsel Zabrina Jenkins. The Reinvention plan is Starbucks' strategy, announced last September, to focus on new consumer behavior.
Jenkins' letter is the latest in a series of standoffs between Schultz and Sanders since the Vermont senator took the helm of the Senate Committee on Health, Education, Labor and Pensions last month. On Wednesday, Sanders scheduled a subpoena vote to force Schultz to testify after Starbucks declined to make the CEO available. The company instead offered AJ Jones II, the head of public affairs, to testify on alleged labor law violations.
"We fail to understand why Mr. Jones is not being permitted to offer testimony on these issues," Jenkins' letter said. "This is concerning, as [Sanders] has not provided an explanation or rationale for his rejection of Mr. Jones."
In response, Sanders said Thursday he wants Schultz to testify because as the head of the company, "he is the man who engineered and continues to make labor decisions at Starbucks."
Schultz "is the CEO of Starbucks, he is the spokesperson of Starbucks and he will continue to be on the Board of Directors at Starbucks well into the future," Sanders said in a statement. "Mr. Schultz has made it clear that he is the driving force of labor policy at Starbucks."
According to the Starbucks letter, Jones met with Sanders' staff and other committee members last month.
Jenkins, Jones and May Jensen, vice president for partner and labor relations, are part of the executive team that makes union-related decisions, according to the letter. The disclosure of a designated team marks a first in learning how Starbucks handles its delicate exchanges with the 285 store unions across the country.
Sanders noted a National Labor Relations Board decision released Wednesday that concluded Starbucks violated labor law in Buffalo, New York, where the first union was formed. NLRB's Administrative Law Judge Michael Rosas ordered the company to reinstate workers who were terminated, reopen a store that had been shut down and ordered Schultz and another executive to read a notice to Starbucks employees about their rights under the National Labor Relations Act.
Rosas wrote that in November 2021, before returning as CEO, Schultz had a meeting with all Buffalo-area store workers. During the meeting, Schultz talked about how his upbringing shaped his business conduct, the company's growth in the past 50 years and outlined several employee benefits such as company stock options and disbursements for emergencies, Rosas wrote.
Schultz said Starbucks was personal to him, according to Rosas' letter. "The company's core purpose, Schultz said, was 'to build the kind of company that creates a fragile balance between profit and doing the right thing.'"
The meeting makes clear Schultz's labor policy influence at Starbucks even when he is not the top executive, Sanders wrote.
Schultz "has denied meeting and document requests, skirted congressional oversight attempts and refused to answer any of the serious questions we have asked," Sanders said earlier this week. He added the committee has "no choice, but to subpoena him."
The subpoena vote is scheduled for Wednesday.
