June 13, 2024

Supreme Court Sides with Starbucks in Labor Dispute

The U.S. Supreme Court recently ruled in favor of Starbucks in a significant labor law case, overturning a lower court’s order that required the company to rehire seven employees in Memphis who were fired while attempting to unionize. This ruling will make it harder for the National Labor Relations Board (NLRB) to win court orders when it suspects a company of interfering in unionization campaigns. 

The justices unanimously dismissed the previous court’s injunction, which was based on an NLRB request. The injunction aimed to reinstate the workers while the NLRB pursued an internal case against Starbucks. The Supreme Court found that the lower courts used an incorrect legal standard that Starbucks argued was too lenient. 

Under the National Labor Relations Act, a court can issue an injunction to stop unfair labor practices temporarily. However, Starbucks contended that a more stringent four-factor test, similar to those used in other legal contexts, should be applied. This test assesses factors such as irreparable harm and the likelihood of success on the merits. 

 

Justice Clarence Thomas, writing for the court, agreed that the lower courts should use this stricter standard. The case has been sent back to the lower court for reconsideration under the proper criteria. While Justice Ketanji Brown Jackson partly dissented on how the test should be applied, the decision was otherwise unanimous.