Starbucks increases base pay of workers in October

The company will also double annual stock contributions for employees who work for Starbucks for at least two years, which will effectively increase workers’ pay by between 5% and 15%.

Starbucks Corporation (NASDAQ:NASDAQ) chose to increase the wages of all workers in company-operated stores in the United States on October 3, according to the company’s CEO Howard Schultz.

Starting Monday July 18, the company is making changes to its health and benefits program to allow employees “to personalize their health coverage, select an insurance carrier, and choose a coverage level that fits their needs”.

Starbucks has 7,600 stores in the USA with around 150,000 employees and reported second-quarter earnings of $4.99 billion in revenue. Schultz emphasized the company’s commitment to what he described as “striking the delicate balance between profit and a social conscience”.

The news of pay raises also comes the day before Starbucks institutes price hikes on many of its products. Last month Macy’s Inc. struck a tentative deal with some of its workers, in which an employee union negotiated higher wages and more affordable health care.

The pay rises will result in 5% to 15% increases for workers.

“Restaurants have to step up and pay people more”, said BTIG restaurant analyst Peter Saleh.

One person who commented on Schultz’s Facebook post (identifying herself as a nine-year employee) expressed concern that the benefits changes could be detrimental to those who are happy with their current plan.

“You end up taking it personally, when corporate directs your stores to understaff, and under-schedule”, the petition said “You wonder if they realize how hard it is to pay your bills when you work 25 hours a week?” We believe that more variety, flexibility and personalization will further elevate the Starbucks Experience – for partners and customers alike.

A Starbucks logo is seen at a Starbucks coffee shop in Vienna, Austria, June 21, 2016.

And finally to address morale he said the company is loosening its dress code “providing more room for self-expression”.

The message that was written by the CEO of the company began with a paragraph that encouraged the employees to look beyond their differences and build mutual trust.