Starbucks New Standards with Exceptional Employee Benefits: Surpassing Competitors
Starbucks, the world-renowned coffee giant, is taking a significant leap forward in its unwavering commitment to enhance the lives of its employees, whom the company fondly refers to as “partners.” Starbucks is introducing a range of new benefits that are set to significantly elevate the retail partner experience.
These investments signify Starbucks’ dedication to improving the lives of its employees, with early vacation accrual, continuous investment in partner compensation, innovative financial wellness programs, personalized scheduling, and the much-anticipated introduction of the inaugural North America Barista Championship.
Starbucks has long been recognized for its commitment to providing the best benefits for its employees, and their new offerings aim to set the bar even higher. Their approach to actively listening to partner feedback and implementing substantial investments in partner well-being has cemented their status as a leader in delivering top-tier benefits for hourly retail workers.In a recent Benefit Index analysis conducted by AON, Starbucks emerged as the frontrunner among more than 50 U.S. companies, including Fortune 200 and Fortune 500 companies, in delivering valuable benefits to retail hourly partners.
What sets Starbucks apart is its comprehensive benefits package that goes beyond industry norms, making it accessible to a broad range of its retail hourly workforce, including those working a minimum of 20 hours per week.
Sara Trilling, the Executive Vice President and President of Starbucks North America, underscores the importance of investing in their partners to drive success. She states, “Investing in our partners is what drives our success. It’s what makes us all partners. And an important way we do this is by investing in our partners’ journeys to bridge to a better future at Starbucks and beyond.
This entails engaging with and listening to their ideas and feedback while continuing to raise the bar by offering competitive pay and the best benefits package in the industry. This independent study from AON has validated that we are an industry leader in our work to enhance the partner experience.”
Starbucks’ commitment to its partners is evident through substantial investments of over $1 billion since the previous year to uplift the overall partner and store experience. This has yielded significant results, with hourly turnover rates now standing below pre-pandemic levels.
Additionally, Starbucks has reinvested over 20% of their profits from fiscal year 2023 back into the partner experience through wage increases, training, and new equipment. These investments have translated into a more consistent partner experience in company-operated stores across the U.S., resulting in lower turnover, an improvement in customer connection scores year-over-year, and an increase in hourly total cash compensation by nearly 50% since Fiscal Year 2020.
Here are the key highlights of Starbucks’ partner investments:
- Vacation Accrual: Starting in February, hourly partners will start accruing paid vacation time just 90 days after being hired, allowing them to spend more time with family and friends outside of work. This new benefit underscores Starbucks’ commitment to nurturing human connections.
- Competitive Pay: Starbucks remains unwavering in its efforts to ensure that its partners are well compensated. The company moved the wage floor for all U.S. retail hourly partners to $15 per hour in 2022 and has continued to add incremental increases while also recognizing and rewarding tenure. Starting with competitive pay, Starbucks provides U.S. hourly retail partners with an average wage of nearly $17.50 per hour, a barista wage range between $15 and $24 per hour, and a total compensation, including benefits, of approximately $27 per hour. Effective January 1, eligible U.S. retail hourly partners will see an incremental pay increase come to life, with at least a 3% increase and differentiated pay for eligible tenured partners. Eligible partners with 2–5 years of service will get at least 4%, and those with 5 or more years of service will get at least 5%.
- First-Ever North America Barista Championship: Starbucks recognizes the dedication and passion of its partners, who take immense pride in their craft. With the long-awaited, first-ever North America Barista Championship kicking off this February, Starbucks partners will have the opportunity to showcase the unique role they play in bringing the Starbucks experience to life for customers each day. This program will be open to eligible baristas and shift supervisors in participating U.S. and Canadian stores, as well as eligible Siren Retail roles.
- Career Mobility: At Starbucks, it’s not just about coffee; it’s about the development of partners in their day-to-day roles. To further support partner career growth and mobility, the company is exploring credential and certification programs to build on the industry-leading Starbucks College Achievement Plan. More than 23,000 partners are currently on their unique educational journey to earning their first-time bachelor’s degree through the the Starbucks College Achievement Plan (SCAP), a first-of-its-kind partnership with Arizona State University’s (ASU) top-ranked online degree program. Starbucks covers tuition and fees upfront for partners, helping to remove the hurdle of rising tuition costs that often block their pathway. To date, more than 10,000 partners have graduated, and 20% of partners enrolled in SCAP are first-generation college students. Starbucks is committed to helping at least 25,000 partners graduate by 2025, with an expected investment of approximately $250 million or more by 2025.
- Financial Wellness: Financial wellness is a cornerstone of Starbucks’ benefits package, with equity ownership in the company through annual Bean Stock grants. These grants have awarded more than $2 billion in additional earnings to partners. Starting this January, partners will be able to sign up to receive the new Siren Card, a premium card offering a high-tech banking experience designed exclusively for Starbucks Partners. Built with cred.ai and Visa USA, the Siren Card comes packed with exclusive tech features, including the world’s first “automatic credit score optimizer,” 24/7 support, and the guarantee to never pay account fees or interest, all supporting financial wellness with zero effort.
- Partner-Centric Scheduling: Starbucks is dedicated to partner-centric scheduling, ensuring that partners have work schedules that align with their individual needs and preferences. This commitment is reflected in Starbucks’ approach to creating work schedules that carefully balance the availability of partners with the staffing needs of individual stores. To achieve this, Starbucks collects a range of preferred, minimum, and maximum hours to build a complete picture of partner preferences and assist store managers in scheduling and managing their workforce. This improved scheduling protocol will enable partners to contribute to the personalization of their ideal schedules, thus helping Starbucks improve the stability, flexibility, and consistency of schedules.
These investments represent a continuation of Starbucks’ legacy of providing top-tier benefits, surpassing competitors to offer unmatched value, while evolving its offerings in response to partner feedback.
It’s important to note that changes to wages, benefits, and terms and conditions may not be unilaterally implemented for partners in stores with organizing underway and may be subject to collective bargaining in good faith for partners in stores with certified union representation.
Starbucks remains devoted to bridging a better future for all partners, as exemplified by stories like those of Vic, Corinne, Justin, and Andrea.
Vic Ruiz, a store manager from Ladera Ranch, CA, shares his heartfelt experience of how the Starbucks Family Expansion Reimbursement Program made it possible for him and his wife to adopt a wonderful baby girl. He reflects, “I look at the whole process, and I’m just blown away.