Collective action, the Starbucks Union, and what comes next for the hospitality industry
It wasn’t a worker shortage, it was a wage shortage. Or maybe it was a work ethic shortage. People didn’t want to work anymore, or people didn’t want to work for crummy employers anymore. It was the best of times, it was the worst of times.
The explanations differed, depending on who you talked to, but the problem remained the same: nearly every bar or restaurant in town was short-staffed.
The staffing crunch in the hospitality industry isn’t new—we started covering it almost five years ago. But the pandemic rubbed fresh salt on an old wound. Many workers who were laid off during the first shutdown orders in March 2020 haven’t returned to the industry. Those who weren’t laid off grew increasingly frustrated with poor working conditions and combative customers, and many left the industry voluntarily.
Two years into the pandemic, the problem seems to only be getting worse. According to the Bureau of Labor Statistics’ Job Openings and Labor Turnover Survey, nearly 1 million leisure and hospitality workers quit their jobs in November 2021—the highest number recorded in the history of the series.
As businesses compete to attract a shrinking pool of workers, wages are starting to tick up. Benefits such as health insurance and 401(k)s remain scarce in the hospitality industry, but they’re becoming more common. The balance of power is shifting. This month, we’re digging into how that shift might reshape the local hospitality industry—and how it already has.
Unions are gaining ground (with a long way to go)
“The labor shortage is employer-created and has been a long time coming,” says Chris Fielder, a barista at the Plaza Starbucks. Fielder is a member of the organizing committee at the Plaza store, one of two metro Starbucks that filed for union elections last month (the other is in Overland Park, at 75th and I-35). If successful, Fielder and his coworkers would be represented by Workers United, an affiliate of the Service Employees International Union.
Fielder says unsafe working conditions, unchecked sexual harassment from customers, and wages that have barely moved for some of the coffee shop’s longest-tenured employees all contributed to his decision to join the effort. But he also mentions a leaky fridge that dribbled water onto the floor for months. It was only fixed, Fielder says, when a coworker slipped and got a concussion.
“One of the material changes we need is working materials.”
Hannah McCown, a shift supervisor at the Overland Park Starbucks at 75th St and I-35, says her store began organizing independent of the Plaza location, though they coordinated the timing of their public announcements. McCown cites weak pandemic safety policies, spontaneous cuts to store hours, and dangerous employee parking among the issues at her store.
“Although our issues are different, we are asking for the same thing, which is for our voices to be heard,” says McCown.
They’re joining a labor movement that’s been growing across the country. At the time of this writing, 78 Starbucks locations in 23 states have filed for union elections, with new stores announced almost daily. Pandemic-related challenges have undoubtedly contributed to that movement, but so has the changing makeup of the workforce.
“I definitely think it’s a lot of young people that are being hired into the company,” says Addao Cochran, a barista at the Plaza Starbucks. Cochran is only 18, but he helped lead the push to unionize at his store. He tells me at least three of his coworkers are around the same age. “I think that a lot of young people are now becoming a lot more politically conscious.”
When The Pitch spoke to Starbucks employees at the beginning of February, they were still waiting for a response from Starbucks corporate. In mid-February, they got one. Instead of responding directly to employee petitions, the company launched an anti-union website titled “We Are One Starbucks,” urging employees to vote down the union efforts in their stores.
“We don’t believe having a union will meaningfully change or solve the problems you’ve identified in your stores,” the website reads. “We know we aren’t perfect, but we believe our challenges are best addressed by working together.”
If only there was some way for employees to work together to address workplace challenges!
That befuddled corporate response was unsurprising to tenured members of the local labor movement. Businesses are out of practice negotiating with workers: U.S. union participation has been on a decades-long decline, one that accelerated precipitously in the 1970s and 1980s.
The reasons for that decline are complex but include the persistent effects of state “right-to-work” laws and a series of National Labor Relations Board rulings during the Nixon and Regan administrations that dismantled union obligations.
“Organized labor has been under attack for 35 years,” says Pat “Duke” Dujakovich, President of the Greater Kansas City AFL-CIO. The AFL-CIO is the nation’s largest federation of unions, which means Dujakovich represents more than just hospitality workers—his members range from custodians to firefighters to Patrick Mahomes. But the labor landscape is shifting locally, and Dujakovich says he’s clocked a resurgence of interest in unions among the hospitality industry in particular.
That could be good for workers and businesses; the relationship doesn’t have to be adversarial. Although Starbucks has stymied organizers thus far, Dujakovich thinks unions might be able to appeal to smaller, independent restaurant and bar owners by offering them assistance with training, staffing, and access to higher quality health care plans for their employees.
“If we can show value to these small businesses like that—that they can join a union, pay about what they’re paying right now and have access to our health care—then we’re going to have a much easier job organizing,” Dujakovich says. “This could be a great turning point for organized labor, but we’ve got to move quick, before the moment ends.”
Workers don’t seem to be wasting any time. On Jan. 30, Cauldron Collective hosted an informational meeting at the Stray Cat Film Center for non-managerial industry workers to share grievances and gather information about how to unionize their workplaces.
Although The Pitch was barred from attending, Collective member Olive Cooke says there were attendees from nearly every corner of the hospitality industry, from fast-casual to fine dining to school cafeterias.
“We’re starting to realize, as workers, how important our power is,” Cooke says.
Worker-owned collectives are promising a new labor model
Cooke and her coworkers aren’t the most obvious hosts for a labor organizing event. A union wouldn’t make much sense for their own restaurant, which is structured as a worker-owned collective. The Collective’s three employees—Cooke, Kim Conyers, and Sylvia Metta—all own an equal share of the business and have equal say in its operations.
We wrote about the Collective and their business model back in January, but we called them back up after the Jan. 30 union meeting to talk about where they think the broader industry is heading.
None of the trio seemed surprised by the staffing issues facing local restaurants. Workers have been frustrated with conditions in the industry for a while, they say, and the pandemic only exacerbated things.
“It’s less of a worker shortage and more of a good employer shortage,” Metta says.
Hosting the union meeting to help organize workers was step one. Fostering an environment conducive to more worker-owned cooperatives is step two. “A union represents the workers to the boss, but the boss still owns what they produce,” Cooke explains. “Collectivism is the next step forward because it takes out that variable, the ownership variable, and gives everybody ownership over their jobs.”
Worker-owned collectives aren’t new, but they’re still relatively uncommon in the hospitality industry. When the Collective started putting together their business plan, they found only about 50 cooperatively-owned restaurants in the United States. Most were located on the coasts, but there was a surprising cluster of worker-owned restaurants in the Midwest—in particular, the Minneapolis-St. Paul metro.
Conyers sees that as a sign of the model’s success (and local reproducibility). “Once the model starts in a place, the people in that direct area start talking and say, ‘oh my god, this is totally working.’ And it kind of takes off from there.”
The collective model can pose challenges to restaurants, too, especially if the company wants to grow. Selling stock in a company can be complicated when only workers are allowed to have a say in that company’s decisions—shareholders might not have any influence on the restaurant’s operations or payout policy. And many commercial banks aren’t prepared to process loan applications with multiple worker-owners.
But alternative financial services have been stepping in to fill that gap. The trio has consulted AltCap, a community development financial institution (CDFI) that specializes in microloans to underserved communities. They also recently launched a GoFundMe to help them finance the purchase of a food truck.
They may not be the only collective in KC for long. In December, Kyle Gardner and Howard Hanna announced plans to open two cooperatively owned and operated restaurants—Small Axe, a modern diner, and Afi, a globe-trotting wine bar—under an ownership group called the Manaia Collective.
The idea for the Manaia Collective came out of the pair’s experience during the pandemic, when they helped close down The Rieger and transform the restaurant into a community kitchen, serving pay-as-you-can meals to people in need.
“Kind of overnight, that [collective] model just happened,” Gardner says. “Everyone started getting paid the same wage, their daily tasks were dependent on what we needed to get done that day. We didn’t have clear divisions between front of house and back of house. We didn’t have people saying, ‘no, I can’t do that,’ or ‘that’s not my job.’ Everyone just kind of found out what their skill sets were and made it work.”
The details of how the Manaia Collective will operate aren’t yet finalized—they can’t be, Gardner says, until the opening teams have been hired. He wants his employees to have a say in every aspect of the restaurants’ operations, from how to share profits to what kind of soap to use in the bathrooms. But he does say each employee, whether they’re part-time or full-time, will get an equal say in the company decisions. One vote per employee; no votes for non-employee investors.
Gardner mentions Cauldron Collective and their recent union meeting as positive developments in the industry’s labor movement. The restaurant industry has depended on exploitative labor practices since its inception; the pandemic only exacerbated some of those issues. But it also served as a long-overdue wake-up call for workers, restaurateurs, and landlords alike. It’s going to be hard to go back to sleep.
“I’m optimistic, actually,” Gardner says. “I think that we’re moving toward a more progressive dining scene in the city.”
Business owners are innovating and experimenting
“Your meal is ready! Please take it away!”
The Minnie Mouse voice emerged from the “head” of a four-shelf food delivery robot named Totoro, which had wheeled itself to my table in Sayachi Sushi in Brookside. I removed a bowl of agedashi tofu from its ribcage and hit a button that let the robot know I had what I needed. It wheeled away silently. A few seconds later, a (human) server appeared.
“Did everything come out okay?”
Sayachi isn’t the only business to experiment with putting robots on the payroll. Magic Noodle in Overland Park recently added their own food delivery robot, with a cat-like face and sleek plastic, pointed ears. They named it “Bella.”
Robot workers tend to make the human ones uneasy; the fear is that automation will gobble up jobs. But right now, the robots only deliver food from the kitchen—they don’t take orders or bus plates. Sayaka Falcon, who owns Sayachi with her husband, chef Carlos Falcon, says Totoro didn’t actually eliminate any jobs at her restaurant.
“The thing is, with staffing, even if we have the bodies, a lot of experienced industry people moved on to another career when the pandemic started,” says Falcon. “It’s been hard to find someone with experience.”
Although the industry has been adding jobs at a breakneck pace, as of January 2022, employment in the leisure and hospitality sector was still down 10% from its February 2020 pre-pandemic level. Many restaurants have had to turn to workers with less experience and training to fill vacancies.
Falcon says the robot has allowed Sayachi’s servers to spend more time with customers instead of running back and forth from the kitchen to the tables. It also helps keep kids entertained. The servers don’t resent their new coworkers—“they’re so grateful.”
Still, the hospitality industry seems unlikely to go full cyborg, even in the distant future. Remember all those reports of boorish customers demanding restaurant workers pull down their masks so they could see their faces? U.S. diners don’t like impersonal service; we want our hospitality with a human touch.
To solve the staffing shortage, restaurant and bar owners are likely going to need to experiment with a lot of other innovations, too. Fortunately, there’s a lot of exploration room between “business as usual” and “burning capitalism to the ground.” Restaurateurs may not want to abolish tipping, but they could ease pay discrepancies between front- and back-of-house workers by offering bonuses tied to a performance metric, such as fewer refires for kitchen staff.
That small change has the potential to boost line cooks’ paychecks while saving owners money (fewer refires means lower food costs and happier diners). Similarly, owners of existing bars and restaurants are unlikely to fully hand over the business to their employees—but they could institute percentage-based profit-sharing or employee stock options to incentivize employees to become invested in the business’s success.
Some of these changes are already happening. Todd Johnson, owner of Strip’s Chicken in Olathe, says he started offering his employees profit-sharing (distributed as a percentage of their wages) and a 401(k) plan last year—14 of 15 eligible employees are now participating in the latter. He also offers year-end bonuses based on an employee’s tenure ($50 a month for the first year of service, $100 per month for the second).
Chris Zembrzuski, the owner of Chef Kansas City, recently instituted a profit-sharing program as well. Zembrzuski started Chef Kansas City in his garage six years ago and has since grown it into a catering company and weekly meal prep service with three full-time employees.
Last October, he began distributing a set percentage of the month’s net profits to each of those employees (he declined to tell The Pitch the percentage). It’s not benevolence—it’s business.
“This business is my livelihood,” he says. “I wouldn’t implement it [profit-sharing] if it didn’t make sense.”
Zembrzuski operates out of a ghost kitchen, and he acknowledges that his overhead costs are lower than many other business owners. He understands why profit-sharing hasn’t been adopted more widely, especially as the industry recovers from the pandemic. Food costs are rising, labor costs are rising, and a restaurant might operate with a 5 percent profit margin even in “normal” times. Cutting into those profits further is a tough sell. But Zembruzki and others are banking that those decisions will help grow the business long-term.
Unwinding a yearslong staffing crisis isn’t going to happen overnight. Labor organizers are going to have to continue to push feet-dragging employers into the 21st century. Worker-owned collectives are going to have to demonstrate that their models are profitable and reproducible. And business owners are going to have to continue to innovate to compete for talented staff.
Hospitality industry workers want what everyone wants—a living wage, yes, but also a chance to grow in an industry that respects their dignity and skill. Bread for the table, and roses, too.
They’re not going to settle for a shift drink. “Thank you for your service” was never enough.