Starbucks is cutting paid lunch breaks, paid sick leave and maternity benefits for British employees, and it has been revealed that 7,000 staff have been asked to sign these new contracts.
According to a report in the Guardian, employees have been asked to sign these new terms, which include removal of the right to a 30 minute paid lunch break.
The new contractual terms also include the removal of cash incentives for becoming manager or partner of the year in favour of the award of a plaque and the removal of a bonus scheme for women returning after they have had a baby because “it is not considered a valued benefit”.
It will also see the removal of sick pay for the first day that a member of staff is ill.
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In a statement, Starbucks said:
“Employee pay and benefits are one of the largest investments we make in our business, and the decisions we have taken over the past few months have been about finding the right way to structure packages so that they are balanced across pay, benefits and development.”
It has been reported that Starbucks has told staff that the changes followed a review of other businesses “to consider the competition and the norms in benefits packages”.
Commenting on the removal of sick pay, Starbucks apparently told its staff that funding sick pay from the first day of illness “leads to a considerable cost for the company”. It added:
“It is not just the financial cost of paying partners for their sickness absences we have considered but also the impact this has on partners left to run the shift.”
On paid 30-minute lunch breaks, it said:
“We considered that many businesses don’t pay for lunch breaks. It is meant to be a break from work to have lunch and we therefore believe the long break should not be paid. We have decided to keep the 10-minute break paid as this is for a short-relief break for shifts of four hours or more”.
Following the news, Debi O’Donovan, Editor of Employee Benefits magazine, warned:
“Changing benefits is a delicate business. Employers always need to think carefully about what they are taking away, and why. There’s always a risk that they take away something that costs next-to-nothing, but which is valued by employees and the money they save is not worth the negative fall-out.”
It was also revealed that Starbucks plans to introduce a contributory pension scheme that will allow staff to contribute 1% of their salary, which will be matched by the company. A three-month vesting period for life insurance cover will also be removed.
