A federal appeals court has sharply narrowed a labor case against Starbucks, rejecting three National Labor Relations Board findings involving alleged threats and surveillance during union organizing at a Wichita, Kansas, store.
The U.S. Court of Appeals for the Fifth Circuit, in a ruling issued Sept. 4, declined to enforce the three challenged findings but upheld a fourth involving a manager’s statement to a pregnant employee that benefits could not be guaranteed if workers pursued unionization.
The decision reduces Starbucks’ exposure in the Wichita dispute while reinforcing limits on what employers can tell workers about the potential consequences of union organizing.
Court overturns three NLRB findings
The dispute arose from union organizing at Starbucks’ North Amidon Avenue store in Wichita in 2022.
The NLRB had determined that Starbucks unlawfully threatened employees with loss of benefits, created an impression that union activity was being monitored, and linked changes to hiring and store hours to the organizing campaign.
The Fifth Circuit upheld only the benefits-related finding. It concluded that the NLRB lacked substantial evidence for its determinations concerning reduced operating hours, the closure of the hiring portal and alleged surveillance.
Benefits threat remains a violation
The court upheld the finding involving Maia Cuellar-Serafini, who was pregnant when she spoke with store manager Carmella Neri.
According to the court record, Neri discussed Starbucks benefits with Cuellar-Serafini before saying that benefits could not be guaranteed if she was interested in organizing. The Fifth Circuit found the statement could reasonably be understood as a threat that union activity could affect employee benefits.
The court noted that employers may communicate predictions about the economic consequences of unionization, but such statements must be based on objective facts and cannot become threats of retaliation.
Store-hours allegation rejected
The appeals court disagreed with the NLRB’s conclusion that Starbucks unlawfully attributed reduced store hours to union activity.
The Wichita store had faced staffing shortages, prompting its manager to reduce operating hours. When an employee questioned the change, the manager said it was intended to ease pressure that the union had placed on employees.
The Fifth Circuit found that statement insufficient to establish a threat of reprisal for exercising federally protected labor rights.
Hiring-portal finding overturned
The court also rejected the NLRB’s finding involving Starbucks’ online hiring portal.
An employee had learned that customers were experiencing problems accessing the company’s online application system. Testimony cited in the court opinion indicated that an assistant manager said the hiring portal had been closed because of unionization efforts.
The Fifth Circuit nevertheless found the NLRB’s reasoning inadequate to establish an unlawful threat against existing employees. The court said the hiring decision was too removed from employees’ existing terms and conditions of employment to support the board’s conclusion.
Court finds surveillance evidence insufficient
The Fifth Circuit also overturned the NLRB’s finding that Starbucks created an impression that employees’ union activities were being monitored.
The board had relied in part on statements from Neri indicating that she knew about organizing discussions at the store and elsewhere in the district.
The appeals court said those remarks showed general awareness of union activity but did not establish that management was monitoring specific union meetings or organizing efforts.
Ruling defines limits of employer speech
The decision examined the boundary between protected employer speech and unlawful conduct during union campaigns.
The Fifth Circuit cited Section 8(c) of the National Labor Relations Act, which protects employers’ expression of views and opinions about unionization when those communications do not contain threats of reprisal, force or unlawful promises of benefits.
At the same time, the court held that statements reasonably understood by employees as threats of economic retaliation for supporting a union can violate federal labor law.
That distinction was central to the court’s decision to preserve the benefits-related violation while overturning the other three findings.
Second recent Starbucks ruling
The Fifth Circuit decision follows another appellate ruling involving Starbucks and union activity.
Two days earlier, the Second Circuit overturned an NLRB finding concerning Starbucks employees at the company’s Manhattan Meatpacking District location. That dispute involved restrictions on union-supporting T-shirts and multiple union pins.
The Second Circuit found that the labor board had not adequately balanced Starbucks’ interest in its store image against employees’ rights to promote unionization.
The two cases involve separate disputes, but both rulings represent setbacks for the NLRB’s positions in Starbucks labor cases.
Broader union dispute continues
The Fifth Circuit ruling does not resolve Starbucks’ wider conflict with organized labor.
Workers at more than 700 Starbucks locations have voted to unionize, while employees have filed hundreds of complaints with the NLRB alleging unfair labor practices. Starbucks has disputed many of those allegations.
The company therefore continues to face labor disputes nationally despite the recent appellate victories narrowing findings in individual cases.
One violation remains
The Fifth Circuit did not completely clear Starbucks in the Wichita case.
The court ordered enforcement of the NLRB’s determination involving Cuellar-Serafini, finding that the statement concerning employee benefits amounted to an unlawful threat of reprisal.
The ruling leaves Starbucks with one confirmed labor-law violation in the case while overturning the three other findings challenged on appeal.
Business and labor implications
The decision substantially reduces the NLRB findings against Starbucks arising from the Wichita organizing campaign and provides further guidance on how federal labor law distinguishes protected employer speech from unlawful threats.
For employers, the ruling underscores that discussing potential effects of unionization does not automatically violate federal law, but statements suggesting employees could lose existing benefits because of organizing activity can cross that line.
For Starbucks, the immediate legal outcome is favorable, although the company’s broader dispute with organized labor remains ongoing.
Reporting Credit: This report is based on records from the U.S. Court of Appeals for the Fifth Circuit and the National Labor Relations Board.
