Citing tax reform, Starbucks offers new raises, stock options – seattlepi.com

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Coffee giant also announces expanded family sick leave, parental leave policies
Updated 7:31 am, Wednesday, January 24, 2018

Starbucks announced new pay raises and stock options for its hourly and salaried employees Wednesday, citing the Republican tax plan passed last month as a catalyst for the changes.

In total, the coffee giant said it would shell out more than $250 million in raises, stock options and benefits, including family sick leave time for all U.S. employees, to its 150,000 “partners” nationwide.

The Seattle-based coffee giant became the latest local company to announce benefits or bonuses after passage of the tax plan, which gave massive cuts to businesses and wealthy Americans, in December. Earlier this month, Alaska Airlines announced it was giving its employees a one-time $1,000 bonus.

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“Investing in our partners has long been our strategy, and due to the recent changes in U.S. tax law, we are able to accelerate some significant partner investments to continue our leadership as the retail industry leader in total compensation and benefits,” CEO Kevin Johnson said in a letter to employees.

Eligible Starbucks employees will receive a second wage increase in April in addition to the annual increases they already received during the fiscal year. The company said it expected to spend about $120 million on those increases, which will be paid out based on “regional cost of living and laws that vary from state to state.”

The company will also provide an additional 2018 stock grant for all eligible employees, including those at stores, plants and support centers. Each retail partner will receive at least a $500 grant, while store managers will receive a $2,000 grant. Starbucks valued the new stock options at more than $100 million.

The new “Partner and Family Sick Time benefit” will allow employees to accrue paid sick time based on hours worked. Employees can then use that time if they or a family member needs care. Employees working 23 hours per week will accrue around five days of sick time benefit over the course of one year.

An expanded parental leave policy for store employees will now include non-birth parents, who can earn up to six weeks of paid leave.

In January 2017, a report from Paid Leave for the United States ranked Starbucks’ paid family leave policy as one of the most inequitable in the country. The policy offered 18 weeks of paid leave to birth mothers — and 12 weeks for fathers and adoptive parents — if those parents work in a corporate role. In-store employees such as baristas were offered just six weeks for birth mothers and none for fathers or adoptive parents.

On Wednesday, the company cited a study it commissioned by insurance agency Aon which stated that Starbucks ranked higher than any other U.S. retailer in terms benefits offered to part-and full-time employees.

Seattlepi.com reporter Stephen Cohen can be reached at 206-448-8313 or stephencohen@seattlepi.com. Follow Stephen on Twitter at @scohenPI.

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