Barenboim v. Starbucks Corp. - Second Circuit Court of Appeals
Facts: Plaintiffs Jeana Barenboim and Jose Ortiz filed a class action claim against Starbucks on the grounds that Starbucks's policy of allowing shift supervisors to participate in store tip pools violates New York Labor Law § 196-d. Section 196-d states that "[n]o employer or his agent or an officer or agent of any corporation, or any other person shall demand or accept, directly or indirectly, any part of the gratuities, received by an employee, or retain any part of a gratuity or of any charge purported to be a gratuity for an employee." N.Y. Lab. Law § 196-d.
After summary judgment was granted for Defendant in the United States District for the Southern District of New York, Plaintiffs appealed. The Second Circuit Court of Appeals affirmed.
Holding: The Second Circuit had previously certified two questions to the New York Court of Appeals for interpretation of § 196-d. The New York Court of Appeals concluded that § 196-d allows an employee, whose personal service to patrons is a
principal or regular part of his or her duties, to participate in an
employer mandated tip program, even if that employee possesses limited
supervisory responsibilities. The Court of Appeals held "the line should be drawn
at meaningful or significant authority or control over subordinates."
In this case, the Second Circuit held that allowing shift supervisors to participate in the tip pool did not infringe upon the scope of § 196-d as shift supervisors' primary job function is the same as baristas. The facts established that shift supervisors spent a majority of their time serving food and beverages to customers, similar to a baristas' job. The Second Circuit noted that shift supervisors do have some supervisory responsibility however, such as assigning baristas to a particular position during a shift, administering break periods, opening and closing stores, and depositing money in the bank. However, the Second Circuit recognized that shift supervisors have no input on the creation of work schedules and do not participate in the hiring or firing of employees. Due to the limited nature of these supervisory duties, coupled with the fact that the shift supervisors' primary responsibility is the same as baristas', the Second Circuit held that these actions do not amount to "meaningful or significant authority or control over subordinates."
In this case, the Second Circuit held that allowing shift supervisors to participate in the tip pool did not infringe upon the scope of § 196-d as shift supervisors' primary job function is the same as baristas. The facts established that shift supervisors spent a majority of their time serving food and beverages to customers, similar to a baristas' job. The Second Circuit noted that shift supervisors do have some supervisory responsibility however, such as assigning baristas to a particular position during a shift, administering break periods, opening and closing stores, and depositing money in the bank. However, the Second Circuit recognized that shift supervisors have no input on the creation of work schedules and do not participate in the hiring or firing of employees. Due to the limited nature of these supervisory duties, coupled with the fact that the shift supervisors' primary responsibility is the same as baristas', the Second Circuit held that these actions do not amount to "meaningful or significant authority or control over subordinates."
Judgment: The Court of Appeals affirmed the lower court's ruling.
Majority Opinion Judge: Judges Ralph K. Winter, Reena Raggi, and Debra A. Livingston joined in the unpublished opinion.
Date: November 21, 2013
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