- Starbucks is at a crossroads with former Chipotle CEO Brian Niccol set to take the helm this month.
- One longtime employee says that Starbucks has become more like fast-food rivals.
In 2008, Starbucks investors were pressing CEO Howard Shultz to cut costs at the coffee chain.
One had a novel idea for saving money, Schultz said in a 2010 interview: Why not end healthcare benefits for part-time Starbucks employees? Schultz turned the suggestion down, he told Fortune, and suggested that the investor consider selling his stock.
Schultz has since come under fire for everything from Starbucks' treatment of unionizing workers to the chain's olive-oil coffee drinks.
But for one Starbucks worker at a North Carolina café who has spent 19 years at the company, Schultz's decision on healthcare benefits symbolizes what Starbucks once was.
"It used to be a great place to work," the employee said. "People wouldn't leave Starbucks unless they were college students and went up into a higher career, or they retired with the company." The employee asked not to be identified in this article, citing fear of retaliation from Starbucks, but Business Insider has verified his identity and work for the company.
Starbucks is at a crossroads. The company has spent several years fighting employees at hundreds of stores as they attempted to form unions and negotiate contracts — though Starbucks said this year that it would sit down to bargain with those employees.
The company is also in the midst of a CEO change. Starbucks said last month that Chipotle CEO Brian Niccol would replace Laxman Narasimhan as CEO as of September 9. The switch comes as Starbucks faces slumping sales in the US, long customer wait times, and challenges in its business in China.
Besides the continued healthcare option for part-time workers, the North Carolina employee pointed to the company's stock grant program, called Bean Stock, as well as its decision to call store employees "partners." Starbucks began both in 1991, during Schultz's early years as CEO.
The employee, who started working at Starbucks in the mid-2000s, said the company had a reputation for treating workers well when he joined. But changes over the last couple of years, such as cuts to staffing levels at his store and an increasing stream of mobile orders, have changed that image, he said.
The Starbucks location where the employee works now has two or three people on duty most shifts, down from up to five a few years ago, he said. That leaves partners more stretched, especially with a constant stream of orders placed through Starbucks' app, and less time to serve customers who order in-store.
"It started out as a trendy, quirky coffee shop job, and it's just morphed into this soulless fast food empire since that time," the employee said.
"Ever since Howard left, I said things have just really gone downhill," he added, referring to the period after Schultz stepped down as CEO in 2017.
A Starbucks spokesperson said that the company seeks feedback from employees through surveys and meetings between employees and leadership. Store employees "have multiple opportunities throughout the year to voice their opinions, share their experiences, and suggest areas for improvement," the spokesperson said.
Wall Street analysts have lauded incoming CEO Niccol as the turnaround expert that Starbucks needs, citing Chipotle's severalfold stock price increase during his tenure.
But the Starbucks worker at the North Carolina store isn't as optimistic. He told BI he's skeptical that Niccol will address the problems he sees at his store, including a chronic shortage of worker hours and the surge of mobile orders that tend to overwhelm the employees on duty.
The Starbucks spokesperson declined to comment on any early plans that Niccol has for employee compensation or working conditions. The spokesperson noted that barista wages range "from $15.25 to $26 per hour."
The North Carolina employee also pointed to another reason he's not hopeful: The Chipotle near the Starbucks where he works.
"No matter what time of day I go in, they always look pissed off," he said of the Chipotle employees he sees there. "And it looks like sometimes they don't have enough people working."
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