Business
Starbucks baristas in L.A. and other cities go on strike over elusive contract
Baristas at a handful of Starbucks around Los Angeles as well as in Chicago and Seattle went on strike Friday, kicking off a work stoppage that union officials said would include hundreds of the coffee giant’s stores by Christmas Eve.
The union, Starbucks Workers United, said the strike was necessary after they failed to reach a deal in negotiations with the company over what would be a first contract for Starbucks workers. By walking out from five locations in the Los Angeles area and other key markets, workers are hoping to pressure Starbucks during the busy holiday season, when its frappuccinos and themed drinks are in high demand.
The union said it plans to spread the work stoppages to potentially hundreds of stores over the course of the five-day action that will conclude on Christmas Eve. It is looking to extract from Starbucks a more robust wage proposal and an agreement to quickly resolve outstanding unfair labor practice charges filed by workers in recent years.
A Starbucks tucked into a strip mall on Alameda Street in Burbank that typically opens at 4:30 a.m. stayed closed Friday. At 10 a.m. a crowd of about 30 Starbucks workers, union organizers and supporters walked a picket line outside, chanting, “No contract, no coffee,” and, “Hey, Starbucks, you can’t hide, we can see your greedy side.”
Kai Krawczeniuk, 25, a shift supervisor at the Burbank store, said Starbucks “made an economic offer that was unacceptable.”
“It was insulting, frankly. That made us feel like we have to act, we have to show them we mean business,” Krawczeniuk said.
In a statement, the union said Starbucks had proposed an economic package earlier this month “with no new wage increases for union baristas now and a guarantee of only 1.5% in future years.”
Starbucks said about 10 of its more than 10,000 company-operated stores in the United States did not open as planned today.
“There has been no significant impact to our store operations. We are aware of disruption at a small handful of stores, but the overwhelming majority of our US stores remain open and serving customers as normal,” Starbucks spokesperson Phil Gee said in an emailed statement.
The company criticized the union, saying it had proposed an immediate 64% wage increase that “is not sustainable” and prematurely ended bargaining sessions this week.
“It is disappointing they didn’t return to the table given the progress we’ve made to date,” the company said in its statement.
Besides the Burbank location, four other stores in Southern California, including in Van Nuys, Santa Clarita, Highland Park and Anaheim, were also hit with strikes, said Evelyn Zepeda, organizing director in California for Workers United.
Former Burbank Mayor Konstantine Anthony, who currently is a member of the City Council, joined the Starbucks picket line Friday morning and said the company was “nickel-and-diming” workers. It was “no coincidence,” he said, that the Starbucks strike coincided with work stoppages by Amazon warehouse workers and delivery drivers in the run-up to Christmas.
“Workers have shown up at the exact moment where these two companies make their biggest profits, Christmas season,” Anthony said. “Power lies with the people, people who make the drinks, people who deliver the packages. If you want to give a good product to your customers, you need to treat the people delivering that product well.”
The new work stoppages mark a major turning point for Starbucks Workers United, which formed in 2021 and steadily has made headway in its campaign to persuade baristas at Starbucks around the U.S. to join. Hopes that the two sides would be able to hammer out a deal had been high since February, when the company pledged publicly to work with the union and take a more neutral approach toward the drive to organize workers.
The conciliatory stance was an about-face for a company that previously had intensely resisted the campaign to organize its workers. Federal regulators found Starbucks repeatedly violated labor laws by disciplining and firing workers involved in unionizing activity, shutting down stores and stalling contract negotiations.
The National Labor Relations Board has conducted a total of 647 union elections at Starbucks stores, with 109 of them falling short, several others with challenged ballots and 528 currently with certified bargaining units, according to NLRB spokesperson Kayla Blado. In California, 66 stores have held union elections and 44 of them have had their bargaining units recognized by the labor board.
Blado said workers have filed more than 700 unfair labor charges against Starbucks, its subsidiary Siren Retail Corp., or its law firm Littler Mendelson, alleging a range of violations. The union has not filed any new charges against Starbucks since late February.
In March, the federal board ordered Starbucks to stop threatening and interrogating employees at a store in Cypress Park about union organizing efforts and to post a notice of workers rights. In September, the board ordered Starbucks to stop threatening workers with the closure of a store in Los Angeles if organizing activity continued. And in October, the board found that Starbucks’ former chief executive, Howard Schultz, violated labor law by encouraging a Long Beach employee to quit after they raised issues related to unionization in 2022.
Business
Unemployed, but the nest egg is large. Is it unethical to get public assistance?
Dear Liz: I am out of work and taking a pause on my job search. While I have plenty of savings in a diversified portfolio, enough to last many years if needed, my adjusted gross income is small (mostly capital gains from gradual sales of assets). I think I qualify for low-income assistance programs for utility bills and healthcare subsidies but I’m reluctant to apply. These programs are supposed to be for people in need and it doesn’t feel right for me to participate. Are there legal reasons why a high-wealth/low-income household can’t apply for assistance? Is it ethical?
Answer: If you meet the income requirements for a program — and there are no asset limits that would rule out your participation — then there’s no legal reason for you not to participate.
If the program’s resources are finite, though, you might well feel an ethical qualm about taking assistance that someone else needs more.
However, there’s no reason to pass up the tax credits that help reduce the cost of health insurance purchased through Affordable Care Act exchanges. The program was deliberately designed so that most Americans, not just those in the greatest need, could get help paying their health insurance premiums.
After a windfall, questions on what to do with the cash
Dear Liz: After selling my house and downsizing at age 84, I am cash rich for the first time in my life. My goal now is not so much to grow the money substantially, but to avoid paying taxes on my investments, as I would have to do with certificates of deposit. Are tax-free municipal bonds my best option, or what would you suggest?
Answer: If you’re in a high tax bracket — roughly 32% or higher — the lower interest rates paid on municipal bonds can still give you a good-enough return to make buying them worthwhile. If you’re in a low tax bracket, the math doesn’t work so well.
Also, municipal bonds aren’t covered by FDIC insurance the way a certificate of deposit would be. Investing in bonds involves some risk. The chances of default are minimal if you choose highly-rated bonds, but your bonds could lose value if interest rates rise.
Consider using some of your cash to consult a fiduciary, fee-only planner who can help you figure out a strategy that reflects all aspects of your financial situation, not just your tax bill.
A first paycheck means getting to know Uncle Sam
Dear Liz: My recently-graduated child got a job and he will be given a 1099 tax form for his earnings. I know he will have to file his taxes differently and will need to pay both state and federal income taxes, but will he also make payments toward Social Security? Will these months (and maybe years) go toward his lifetime “credits” of paying into Social Security?
Answer: The company is paying your son as an independent contractor rather than as an employee. That means he will need to file his taxes as someone who is self-employed. So yes, he’ll be paying into Social Security — and he’ll be doing so at twice the rate of employees who receive W2s.
Normally, Social Security and Medicare taxes are split between employees and employers. Both pay 7.65% of the employee’s wages, for a total of 15.3%. Self-employed workers must pay both halves.
Your son won’t have taxes withheld from his earnings, so he’ll likely need to make quarterly estimated tax payments to avoid penalties. A tax pro can help him set up these payments and suggest legitimate expenses he can use to reduce his tax bill.
Clearing up some confusion over those proprietary funds
Dear Liz: Your recent column about proprietary funds confused me. You mentioned that selling these funds can trigger capital gains tax. Is it not true we can move investments directly from one money manager to another and not take a capital gain as long as the funds remain invested?
Answer: If you can move a fund from one investment company to another, then it likely is not a proprietary fund. For example, Schwab, Fidelity, Vanguard and many other firms create funds that bear their names, but these investments can be bought and sold at other brokerages.
Proprietary funds, by contrast, typically lock customers into investments that can’t be transferred to another firm. To get your money out, you have to sell the fund, which can trigger a tax bill. This is a significant downside and one investors should understand before committing their money to this type of fund.
Liz Weston, Certified Financial Planner®, is a personal finance columnist. Questions may be sent to her at 3940 Laurel Canyon, No. 238, Studio City, CA 91604, or by using the “Contact” form at asklizweston.com.
Business
Can Trump persuade the Supreme Court to stand aside so he can solve the TikTok problem?
WASHINGTON — President-elect Donald Trump is telling the Supreme Court that he can make a deal that will resolve the national security dispute over TikTok and preserve the video site for 170 million Americans.
All the justices need to do, he says, is to stand aside and suspend a pending law that could shut down TikTok on Jan. 19, the day before Trump takes office again.
“President Trump alone possesses the consummate deal-making expertise, the electoral mandate, and the political will to negotiate a resolution to save the platform,” his attorney said in a friend-of-the court brief filed Friday night.
His plan might work, at least to buy more time.
The justices had agreed to make a fast-track decision on the potentially momentous issue involving social media and free speech.
“I think the court is likely to see great benefit in issuing a stay and little downside,” said UC Berkeley Law Dean Erwin Chemerinsky. “The case poses a novel and very difficult 1st Amendment issue. Never before has the government tried to ban a medium of communication, but there also is a history of judicial deference to national security claims.”
Prior to Trump’s intervention, TikTok appeared to face a difficult fight in the court.
The House and Senate had passed legislation by large bipartisan majorities requiring the platform to separate itself from its Chinese owner or to shut down in this country.
President Biden signed the bill into law in April. And by its terms, it was due to take effect in 270 days.
Although the justices are not shy about striking down federal regulations, they are wary of overturning an act of Congress, particularly one that is based on threats to national security.
The U.S. appeals court in Washington cited national security when it upheld the law earlier this month. In a 3-0 decision, the judges said the law did not target speech or expression. Rather, lawmakers were convinced the Chinese parent company could gather personal data on millions of Americans, the judges said.
If the law took effect on Jan. 19, Apple, Oracle and other U.S. companies could have faced large civil fines if they continued to work with TikTok.
Trump’s attorney D. John Sauer filed a friend-of-the-court brief that differed in tone and substance from all the others. Rather than weigh in on the 1st Amendment question the justices had agreed to decide, he explained why Trump was better-suited to decide it.
“Through his historic victory on November 5, 2024, President Trump received a powerful electoral mandate from American voters to protect the free-speech rights of all Americans — including the 170 million Americans who use TikTok,” he wrote. “Moreover, President Trump is one of the most powerful, prolific, and influential users of social media in history.”
Noting that Trump has 14.7 million followers on TikTok, Sauer argued that the president-elect is well-positioned “to evaluate TikTok’s importance as a unique medium for freedom of expression, including core political speech.”
He also wrote that as the founder of another social-media platform, Truth Social, Trump has “an in-depth perspective on the extraordinary government power attempted to be exercised in this case — the power of the federal government to effectively shut down a social-media platform favored by tens of millions of Americans.”
“In light of these interests — including, most importantly, his overarching responsibility for the United States’ national security and foreign policy — President Trump opposes banning TikTok in the United States at this juncture, and seeks the ability to resolve the issues at hand through political means once he takes office.”
In 2020, Trump had voiced alarm over TikTok because of its Chinese ownership. Lawmakers later heard classified briefings that convinced them the foreign ownership posed a danger.
But by the time the law won approval, Trump had switched sides. He said he believed TikTok helped him win the support of young voters.
“TikTok had an impact, so we’re taking a look at it,” he told reporters two weeks ago. “I have a little warm spot in my heart.”
A year ago, his attorney Sauer drew criticism from some legal experts for boldly asserting that Trump as a former president had an absolute immunity from criminal charges for his official acts while in office.
But in July, he won a 6-3 ruling from the Supreme Court that gave him and Trump what he had sought.
Sauer is now set to represent Trump and his administration before the Supreme Court as U.S. solicitor general.
He did not say precisely what the court should do now, only that it “should consider staying the statutory deadline to grant more breathing space” to the incoming administration and that one provision in the law allowed for a 90-day extension before it took effect.
The court asked for responses to the competing briefs by next Friday. It scheduled two hours of argument for Jan. 10.
It’s not certain the justices will readily comply with Trump’s request.
Two weeks ago, former Trump attorney Noel Francisco filed an appeal on TikTok’s behalf urging the justices to put the law on hold for a brief period. But the justices brushed aside that suggestion and said they would decide whether divestiture law violated the 1st Amendment.
“I am skeptical Trump’s intervention will make a difference,” said Alan Rozenshtein, a University of Minnesota law professor who has written about the pending law.
He noted that the Supreme Court denied TikTok’s request to stay the law because it did not think TikTok could meet the requirements for a stay: a reasonable chance of winning on the merits.
“Trump’s argument does not change that,” he said. “It may be bad luck for TikTok (and Trump) that the law goes into effect the day before inauguration, but such is life.”
Business
Here's how you can get California to help pay for your e-bike this Christmas
Starting Dec. 18, eligible Californians can apply for a voucher of up to $2,000 toward the purchase of an e-bike as part of a new state incentive program.
The California E-Bike Incentive Project, launched by the California Air Resources Board, was established to help lower cost barriers to transportation methods that aim to replace car trips and reduce greenhouse gas emissions.
Unlike rebates and tax credits for electric cars, applicants don’t have to first buy the e-bike to get the incentive. The voucher acts as a discount at the point of buying an e-bike.
According to the Institute for Transportation & Development Policy, e-bikes can be a suitable alternative to car travel because they can “cover longer distance trips with less effort, relative to traditional pedal bikes.”
E-bike prices range from an average of $2,000 up to $6,000, according to outdoor recreational retailer REI. Experts recommend that consumers avoid extremely low-priced electric bikes, which often come with cheaper parts and overall lower quality, according to Consumer Reports.
Last year, researchers at the National Renewable Energy Laboratory in Colorado found that e-bikes served an unmet transportation need for people who didn’t have access to a car. E-bike riders who did have access to their own vehicle said they preferred the electric bicycle because it was more convenient for trips that were one to four miles in distance, the researchers said.
They also found the benefits of e-bikes included charging and repair costs that are a fraction of such costs associated with cars. E-bike users also have the benefit of a healthy physical activity, free parking, and knowing they are helping reduce traffic.
E-bikes are a transportation method that people can use to get around every day while improving air quality, Steven Cliff, executive officer for the California Air Resources Board, said in a statement.
“Prioritizing equity and access is key as we work to achieve our zero-emissions goals, and this incentive program will support those efforts by helping e-bikes be part of the solution,” Cliff said.
The program will begin with $3 million, with the goal of providing vouchers for the purchase of 1,500 e-bikes. Once the program runs out of vouchers it’s unclear whether the state will add more funding.
The program will start to accept applications at the website ebikeincentives.org at 6 p.m. Pacific on Dec. 18. Applications will be processed in the order received until the vouchers are exhausted.
Who is eligible for the program?
Applicants must be California residents who are 18 years or older with an annual household income at or below 300% of the Federal Poverty Level. That means that a single-person household must make no more than about $45,000 per year and a two-member household must make no more than $61,000 to qualify.
Applicants whose income is at or below 225% of the Federal Poverty Level will receive priority on the application list. This means a single-family household must make no more than about $33,000 and a two-member household income must be no more than $45,000 to get priority.
How are the vouchers used?
Once the application has been submitted online and all of the eligibility requirements are met, the applicant will receive an approval notification with the voucher via email.
Vouchers can be redeemed at retailers who are participating in the program, including 131 retailers in Los Angeles and Orange counties. For an extensive list including a retailer’s contact information, visit the project’s online retailer map.
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