Howard Schultz violated labor law by telling an employee, “If you're not happy at Starbucks, you can work for another company.”

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CNN
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Starbucks' Howard Schultz, then interim CEO, violated federal labor law in 2022 by telling a California barista who raised concerns about unionization, “If you're not happy at Starbucks, you can go to another one.” Companies work.”

A ruling Wednesday by the National Labor Relations Board said Schultz's statement was an unlawful, coercive threat.

The decision underscores the strained relationship between Starbucks and the union as more workers at its stores unionize.

In 2022, while Schultz was interim CEO, he attended a company event in Long Beach, California to address and improve working conditions at Starbucks stores. Barista Madison Hall attempted to raise the benefits of unionization and Starbucks' alleged history of unfair labor practices, according to the NLRB.

Schultz asked them, “Why are you mad at Starbucks?” He said the event wasn't the place to discuss union issues and then made the comment that he had to work somewhere else. According to the administrative law decision, he “had an angry expression on his face.” The NLRB decision affirms an administrative law judge's October 2023 ruling.

In a statement, Starbucks said it disagreed with the board's decision. “Our focus remains on training and supporting our managers to ensure our partners’ freedom of association rights are respected and to continue making progress in our discussions with Workers United,” a company spokesperson said in a statement Thursday.

Although Schultz stepped down in March 2023 after his third term as CEO, he remains associated with the company. When he stepped down from Starbucks' board last September, the company gave him the title of “lifetime chairman emeritus.”

“We note that the judge identified defendant's most senior official, interim CEO Schultz, as a 'legendary leader,' a status that would further reinforce the coercive nature of Schultz's testimony,” the board's decision said.

Since the first Starbucks location in Buffalo, New York, unionized in 2021, the coffee chain has been embroiled in hundreds of labor disputes over its alleged anti-union tactics. One case, Starbucks v. McKinney, reached the Supreme Court in June over seven employees who were fired after attempting to unionize. The Supreme Court sided with Starbucks.

An NLRB administrative law judge previously said Starbucks engaged in “egregious and widespread misconduct” in its treatment of employees involved in unionization efforts at Buffalo stores, including the first location to unionize. Starbucks repeatedly sent senior executives to Buffalo-area stores in a “relentless” effort, the judge wrote, which “likely left a lasting impression of the importance of voting against representation.”

Starbucks said in a statement at the time that it was “considering all options to obtain further legal review,” adding: “We believe the decision and the remedies ordered are inappropriate given the record in this matter.”

According to the union, the 500th Starbucks location in Washington state voted to unionize on October 1.

The NLRB on Wednesday ordered Starbucks to stop threatening to fire employees for union activity and said it must post a notice about workers' rights in all Long Beach stores.

“We are pleased that the NLRB continues to stand up for workers and our legal right to organize. At the same time, we are focused on the future and are proud to forge a new path with the company,” Michelle Eisen, co-chair of the Starbucks Workers United national organizing committee and collective bargaining delegate, said in a statement to CNN on Thursday.