NYC Comptroller: Starbucks ‘not engaging in good faith’ over unionisation concerns

New York City Comptroller Brad Lander talks to RI as it withdraws proposal at Apple following commitment from tech giant to undertake audit on freedom of association.

New York City Comptroller Brad Lander told Responsible Investor that Starbucks has “not engaged in kind of good faith negotiations” with it over anti-unionisation concerns at the US coffee giant. 

Lander, whose office oversees the city’s five public pension funds, was speaking to RI on Wednesday, as news broke that NYC and a coalition of other investors had withdrawn a proposal at Apple after the tech giant agreed to undertake a third-party assessment into its commitment to freedom of association for its workers. 

Investors involved in the engagement effort at Apple include SOC Investment Group, Trillium Asset Management, Parnassus Investments, SEIU Master Trust and the Greater Manchester Pension Fund, supported by UK proxy adviser PIRC. 

Their proposal asked Apple’s board to report on how effective Apple’s policies and practices are “in protecting the rightful application of the fundamental rights of freedom of association and collective bargaining as guaranteed by the ILO [International Labour Organisation] Declaration on Fundamental Principles and Rights at Work and the UN Universal Declaration of Human Rights for its own workers and those in its supply chain”. 

According to the text, the National Labour Relations Board – the US federal agency tasked with enforcing labour law – was investigating 14 charges of unfair labour practices involving Apple. 

Lander told RI that a similar shareholder proposal filed at Starbucks has not been met with the same level of responsiveness as the one at Apple.  

On the commitment from Apple, Lander said that a letter has been sent to the tech giant’s board “outlining both the things that are of concern to us and what we expect to see in its report”. 

As to how much say the investors will have over the selection of the third party that will undertake Apple’s review – an issue that was raised in relation to racial justice audits – RI understands that Apple’s management will make the appointment.

The investors indicated in their letter that they want to see a firm selected that has a “balanced view of labour law”, Lander said, not a firm with a record of “consulting on union avoidance” or for that matter “one with a history of consulting for unions”.    

Another issue raised in the letter is how Apple “looks at the question of non-interference”.  

Lander highlighted that both Starbucks and Apple have signed onto the ILO standards, which “go beyond US labour law to include a commitment to workers’ freedom of association, that you don’t interfere with their right to organise”.  

He added that he has spoken to corporate leaders “who didn’t appreciate that the ILO standards go beyond US law, so I think there will be some important clarifying that needs to take place here”. 

The commitment by Apple was described by Lander as one of several positive steps in recent months, including the labour neutrality agreement between Microsoft and the Communications Workers of America (CWA) in June, and Condé Nast’s recognition of a company-wide union in September.  

“I hope that others like Starbucks and Amazon and will take this step,” Lander said. “We think that respecting your workers’ freedom of association is a critical element of corporate responsibility and that it’s something that should be in all corporation’s policies and practices.”

Starbuck had not commented at the time of publication.