Prompted by the new corporate tax cuts in the United States, Starbucks has announced plans to offer new raises and benefits for its workers.
Starbucks says that it plans to spend $250 million to boost employee pay with a second rise this year in addition to its usual raise in January. Moreover, the company will also offer stock grants as well as a new sick-pay program.
Starbucks has roughly 150,000 workers in the United States, and the changes will apply nationwide.
Starbucks Raises And Benefits
The company announced that it will grant paid sick time to all of its workers in the United States. In addition to its regular raise in January, Starbucks will also implement another raise in April. Starbucks employees will also get additional stock worth between $500 and $2,000. The company says it will offer more details during its earnings call on Jan. 25.
The company touts that its new $250 million investment cements its position as a best-in-class company for both part-time and full-time workers in U.S. retail. The company highlights that for more than three decades, it has raised the bar in terms of employee compensation, being among the first retailers to offer healthcare benefits even to part-time workers.
It also facilitated employees' access to college education recently, and the latest news further boosts its employee package.
Industry-Leading Benefits Package
"Today, we are proud to announce additional investment in stock, wages and a new Partner and Family Sick Time benefit that will further enhance our industry-leading approach," says Starbucks CEO Kevin Johnson. "The value of Starbucks benefit package [fully accessed] is unmatched by other retailers and provides thousands of dollars above the value of other companies compensation offerings."
The minimum stock grant will be $500, but store managers can get as much as $2,000 worth of stock. Starbucks will also allow employees to get accrued leave to take care of themselves or loved ones when they are sick. New fathers who work at the coffee shop will also be able to benefit from a greater paternity leave.
The company says that it always planned to invest in its partners (employees). The recent U.S. tax reform allowed it to speed things up and make a heftier investment in this endeavor.
The new U.S. tax plan, which President Donald Trump signed into law in December 2017, lowers the top corporate tax to 21 percent instead of the previous 35 percent. The tax cut has prompted several U.S. companies to increase pay or offer additional benefits, and more are expected to follow suit.