Starbucks Corporation (NASDAQ:SBUX) is revising the pay scale for all employees in the United States hired before Sept. 24, according to an internal memo reviewed by Business Insider. The decision is being seen as an attempt by the coffeehouse company to keep up with President-elect Joe Biden’s $15 per hour minimum wage plan.
What Happened: The wage hike will take effect from Dec. 14, as per the memo.
All eligible café attendants, baristas, and shift supervisors employed by the coffeehouse would receive a minimum wage hike of 10%.
Wages in all company-owned outlets will increase by 11%. Reportedly, Starbucks will also revise its starting wages by 5%.
Why Does It Matter: A company representative Reggie Borges claimed that, for over 50 years, Starbucks has been a front runner to ensure workers are paid above the minimum rate.
“Continuing in that tradition, this announcement is the next phase of our commitment to ensuring the well-being of partners with one of the most significant investments to hourly pay in the U.S. in the history of the company," Borges said in the memo as per Business Insider.
Rossann Williams, president of Starbucks' company-owned stores in the U.S., said the decision is “one of the most substantial investments in pay in our company's history."
Price Action: SBUX closed 0.7% lower at $97.91 on Wednesday.