Shareholders Press Starbucks to Reinstate Labor Committee Amid Stalled Union Talks

A coalition of activist shareholders, including the New York City and New York state comptrollers, is pressuring Starbucks to reinstate a board-level committee dedicated to labor oversight. The investors argue the company has failed to manage risks associated with its strained union relations, particularly the absence of a labor agreement nearly five years after its first US store unionized.

The Proposal

A shareholder proposal filed Friday by New York City’s comptroller, following identical filings from the New York state comptroller and Trillium Asset Management, asks the coffee giant's board to bring back a committee dissolved in November 2025. The filers, who collectively hold nearly $270 million in Starbucks shares, described labor relations as one of the company's "most significant and persistent risk areas" in a copy of the proposal reviewed by Reuters.

The investors highlight that no collective bargaining agreement has been reached with Starbucks Workers United, which represents about 5% of the company's US stores. "The board will function best when particularized risks like this get the attention of a committee," said Jonas Kron, chief advocacy officer at Trillium Asset Management, in an interview with Reuters.

Company Position and Background

Starbucks responded in a statement that it was confident its board "has the necessary skills and experience to effectively oversee our strategy." The original committee was created in 2023 after pressure from some of the same shareholder groups. It was disbanded in November 2025, a little over a year after CEO Brian Niccol took charge.

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In a March investor presentation, Starbucks stated the committee's duties were redistributed among other board functions to provide "stronger and more integrated" oversight. This move was previously criticized by some of the current filers in a failed campaign to unseat two directors at the March shareholder meeting, a campaign that nonetheless drew support from influential proxy advisory firms.

Investor and Market Implications

The prolonged labor dispute poses potential risks for investors, including ongoing reputational damage and financial liabilities. Proxy advisors have previously warned that Starbucks could be overlooking risks from strikes and legal settlements, such as a $38.9 million payment to New York City over alleged scheduling violations.

Starbucks has also faced pressure from US lawmakers and UN human-rights experts over its handling of unionization efforts. Starbucks Workers United endorsed the shareholder proposal, stating that "investors should take a hard look at how the company’s long list of unsettled labor issues" could negatively affect its turnaround plan. Despite these challenges, the company's stock is up 13% year-to-date.