A judge on the U.S. National Labor Relations Board is ordering Starbucks and its CEO Howard Schultz to agree—on camera—not to suppress union activity, after ruling the coffee company illegally tried to suppress labor organizing in its Buffalo stores.
On Wednesday, Michael Rosas, a judge on the NLRB, ruled that Starbucks had displayed “egregious and widespread misconduct demonstrating a general disregard for the employees’ fundamental rights,” and issued a broad order forcing the coffee company to take nationwide action.
Rosas agreed with labor organizers that Starbucks violated labor law in trying to stop unionizing in its Buffalo stores, including sending high-ranking officials to “make repeated and unprecedented visits to stores in order to more closely supervise, monitor or create the impression that employees’ union activities are under surveillance.”
The judge’s order includes a 13-page notice that affirms the right of Starbucks’ employees to join a union, and a long list of pledges by the coffee company to stop engaging in activity deemed to be hindering union organization.
Schultz must either read the notice, or be present as as an NLRB representative reads the notice, in Starbucks’ Buffalo-area stores. The company also needs to record and distribute a video of the meeting, as well as post paper copies of the notice in its stores across the country.
The judge also ordered Starbucks to compensate workers he deemed to have been unlawfully punished for their union activism. In addition, Rosas concluded that Starbucks had tainted a failed union vote at one Buffalo store, and ordered the company to bargain with the union.
“This is truly a historic ruling,” Gary Bonadonna Jr., the regional head of Workers United, which is helping Starbucks employees to unionize, in a statement.
Starbucks did not immediately respond to Fortune’s request for comment. The coffee company said it was “considering all options to obtain further legal review” in a statement to the New York Times. Rosas’ order can be appealed to the whole NLRB, and then to federal court.
Even if the appeals affirm Rosas’ order, Schultz may no longer be around to read the notice. Laxman Narasimhan will replace Howard Schultz as Starbucks’ CEO in April, ending Schultz’s third stint as Starbucks CEO.
The National Labor Relations Board is an independent U.S. government agency that supervises unionization elections and investigates allegations of unfair labor practices. The NLRB has previously ruled that Starbucks violated labor law by retaliating against union activists.
Employees at a Starbucks store in Buffalo were the first of the coffee company’s workers to unionize in December 2021. Since then, employees at hundreds of Starbucks stores have voted to join the union.
Also on Wednesday, several dozen Starbucks employees and managers signed an open letter complaining about the company’s anti-union activity, as well as its return-to-office mandate. In January, Schultz ordered corporate employees to return to the office at least three days a week.
“We love Starbucks, but these actions are fracturing trust in Starbucks leadership,” said the letter.
Yet Schultz believes the union drive was caused by a lack of leadership—specifically, his leadership. “The unions showed up because Starbucks was not leading in a way that was consistent with its history in terms of being a values-based company, and I came back to basically restore those values,” he said in an interview with CNN last week.
Schultz also said the unionization in companies like Starbucks and Apple was indicative of deeper social issues. “I was shocked, stunned to hear the loneliness, the anxiety, the fracturing trust in government, the fracturing trust in companies, fracturing trust in family, a lack of hope in terms of opportunity” among Starbucks employees, he told CNN.
Learn how to navigate and strengthen trust in your business with The Trust Factor, a weekly newsletter examining what leaders need to succeed. Sign up here.