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Daniel Gross, a Starbucks barista- turned-lawyer, says most companies who are sued spend anywhere between $200,000 and $300,000 on lawyers alone — and awards for damages can be much higher.
Gross went to law school because of his own issues with his workplace. "It quickly occurred to me that the way to secure better wages, fix poor working conditions and really make progress was to get acquainted with the law," Gross tells Business Insider.
At Starbucks, Gross was dissatisfied with his $7.75/hour salary and the part-time shifts that all employees were required to take. "The economic uncertainty of not knowing how much you were going to make at the end of the month was jarring," he says.
But it wasn't just wages that were a problem. He and his colleagues "became concerned about the presence of rats and insects at Starbucks stores," and soon found out that other branches had this problem as well. When the Department of Health discovered that 44 New York branches were in violation of code, Gross and his colleagues launched a campaign that garnered international attention by standing in front of a Starbucks branch with a giant inflatable rat.
Gross also headed a campaign that highlighted the poor nutritional value of some of the food offerings at Starbucks. Now, Gross takes large corporations to court for a living as head attorney and executive director of Brandworkers International, a non-profit that provides legal services to retail and food employees.
Most recently Brandworkers secured close to $1 million dollars in damages from Beverage Plus, a Queens-based distributor whose employees claimed to have worked 12-hour-days without being paid overtime. Individual workers walked away with up to $165,000 after the suit. Richard Merino, one of the plaintiffs, was fired shortly after becoming involved. He added (and won) retaliation claims to the case.
There are many cases like this each year. A 2011 Forbes article says that 5,000 lawsuits are filled against Wal-Mart each year. Although some cases lead nowhere, when workers' dissatisfaction goes public, companies often find themselves dealing with a PR nightmare.
"The damage to the brand is enormous," says Gross. Another case he handled against Flaum Appetizing, a Brooklyn-based kosher food manufacturer, is a case in point. The company paid a $577,000 settlement for withholding overtime pay; and beyond that 120 grocery stores stopped carrying their products in protest.
"Instead of allowing workers to be passionate about the food they are making, the business model is encouraging the opposite," Gross says.
Then there are companies like Whole Foods on the other end of the spectrum. CEO John Mackey pays employees an average of $15 an hour, and the majority also have benefits.
That's just good business. At the end of the day, happier, well-paid workers do more for the bottom line, and just as importantly, protect a company's brand.