US Supreme Court Sides with Starbucks Over This Case

By: May Man Published: Jun 15, 2024

On Thursday, the U.S. Supreme Court ruled in favor of Starbucks in its challenge against a judicial order that required the coffee giant to rehire seven Memphis employees who had been terminated while attempting to unionize.

This decision may complicate the ability of courts to promptly intervene in labor practices contested as unfair under federal law.

Approval Overturned

In a unanimous decision, the justices overturned a lower court’s approval of an injunction sought by the U.S. National Labor Relations Board (NLRB).

Beverage cups featuring the logo of Starbucks Coffee are seen in the new flagship store on 42nd Street August 5, 2003 in New York City. The Seattle-based coffee company has emerged as the largest food chain in the Manhattan borough of New York with 150 outlets.

Source: Stephen Chernin/Getty Images

This injunction had mandated Starbucks to reinstate the workers while the NLRB’s administrative case against the Seattle-based company proceeded.

Improper Legal Standard

The Supreme Court found that the lower courts had applied an improper legal standard.

A close-up of the Supreme Court seen during sunset.

Source: Ian Hutchinson/Unsplash

Starbucks claimed it was excessively lenient to issue the preliminary injunction as requested by the NLRB under the National Labor Relations Act.

Interim Measures

The preliminary injunctions serve as interim measures to halt unfair labor practices while the NLRB resolves the complaints.

A wooden judge’s gavel on a white surface.

Source: Tingey Injury Law Firm/Unsplash

According to section 10(j) of the Act, a court can issue such an injunction if it is deemed “just and proper.”

Four-Factor Test

However, Starbucks argued that the judge should have employed a stringent four-factor test before issuing the injunction, akin to the standards used by other courts and in non-labor legal disputes.

Close-up view of an illuminated round Starbucks sign hanging outside a café, set against a dark background with soft focus on nearby trees

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This four-factor test includes an evaluation of whether the party seeking relief would face irreparable harm and if they are likely to succeed on the merits of their case.

Back to Lower Court

Justice Clarence Thomas, a conservative member of the court, authored the ruling, and the justices unanimously agreed to send the case back to the lower court to apply the four-factor test.

Justice Clarence Thomas

Source: Earl McDonald, Wikimedia

In a partial dissent, liberal Justice Ketanji Brown Jackson disagreed with the majority on how the lower court should implement part of this test.


Biden Administration Defends NLRB

Starbucks maintained that, under a more rigorous standard, the case would have had a different outcome in the lower courts. The Biden administration defended the NLRB’s actions, pointing out that the NLRB seeks such injunctions in only a few select cases.

NLRB members standing in front of NLRB seal

Source: NLRB, Wikimedia

In 2022, for instance, the agency requested just seven injunctions despite receiving 20,000 unfair labor charges annually.


Many Starbucks Locations Unionized

Currently, around 400 Starbucks locations in the United States have unionized, involving over 10,000 employees. Both Starbucks and union representatives have accused each other of engaging in unlawful or improper conduct.

Nighttime view of a Starbucks coffee shop with large glass windows revealing the interior, featuring customers seated at tables, warm lighting, and visible Starbucks branding above the entrance

Source: Wikimedia Commons

Numerous complaints have been lodged with the NLRB, accusing Starbucks of unlawful labor practices such as firing union supporters, surveilling workers, and closing stores during labor campaigns. Starbucks has denied any wrongdoing, stating it respects workers’ rights to unionize.


Establishing a “Framework”

In February, both parties announced they had agreed to establish a “framework” to guide organizing and collective bargaining, potentially resolving numerous ongoing legal disputes.

A close-up photo of a Starbucks coffee cup. The cup is white with the iconic green Starbucks siren logo on it

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Following the Supreme Court ruling, Starbucks reiterated its commitment to reaching contracts with union-represented stores within the year. The company stated, “Consistent federal standards are important in ensuring that employees know their rights and consistent labor practices are upheld no matter where in the country they work and live.”


Controversy on Polar Avenue

The controversy traces back to 2022 when workers at a Starbucks café on Poplar Avenue in Memphis were among the first to unionize. During the early stages of their campaign, they allowed a television news crew into the café after hours to discuss their efforts.

News crew filming an interview

Source: Freepik

Starbucks subsequently fired seven workers who were present that evening, including several members of the union organizing committee. Despite these dismissals, the employees voted to join the Workers United union.


Unfair Labor Charges Filed

The union filed unfair labor charges with the NLRB, claiming the firings were an unlawful attempt to stifle the union drive and intimidate other workers.

Activists protesting holding loudspeaker and sign

Source: Freepik

Lynne Fox, president of Workers United, criticized the Supreme Court’s decision, stating, “Working people have so few tools to protect and defend themselves when their employers break the law. That makes Thursday’s ruling by the Supreme Court particularly egregious. It underscores how the economy is rigged against working people all the way up to the Supreme Court.”


“Chilling Effect”

In 2022, U.S. District Judge Sheryl Lipman granted the injunction, ordering the reinstatement of the workers to mitigate the “chilling effect” their dismissals had on the unionization effort.

A Starbucks in Beijing, Shanghai. A barista is working behind the till, and a couple of people are sitting at tables, but the store is mostly empty.

Source: Colin Lee/Unsplash

The 6th U.S. Circuit Court of Appeals in Cincinnati upheld this injunction in 2023.