A labor union-backing shareholder is leveling new accusations against Starbucks ahead of a proxy fight at its annual meeting in March.

According to CNBC, the Strategic Organizing Center (SOC), a coalition of North American labor unions, asserted that the coffee giant has pursued a "flawed human capital management strategy" in response to a yearslong unionization effort at the world's largest coffeehouse chain.

SOC Criticizes Starbucks Approach to Union Movement

According to the SOC, Starbucks' approach in addressing the union movement has not only failed to resolve internal disputes but also led to reputational risks, reduced shareholder returns, and alienated customers. 

The coalition, which nominated three candidates to the board of Starbucks in November, plans to replace three current board members with its own nominees, a move aimed at redirecting the company's strategy.

Starbucks' annual meeting, scheduled for March 13, is where shareholders will vote on the composition of its eight-member board. The SOC reportedly plans to file the investor presentation with the US Securities and Exchange Commission on Tuesday.

In a copy of the proxy presentations acquired by CNBC, the coalition said: "The Board's anti-union strategy has resulted in one of the most glaring and destructive examples of human capital mismanagement in modern U.S. history." 

It added that "Starbucks' aggressive unionization response has not only failed to resolve the Company's dispute with employees - it has made the problem worse." 

In response to the allegations, Starbucks defended its board, saying the company comprises highly qualified business leaders capable of driving current operations and future success.

Starbucks further noted that "with partners at the heart of our business," the company has made "over 20% of profits that have gone into wage increases, training, and new equipment in the last fiscal year."

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Brewing Conflict Between Starbucks and its Workers

The brewing conflict between Starbucks and its workers intensified following unionization efforts, with baristas from nearly 400 Starbucks-owned cafes voting in favor of organizing since late 2021. 

Despite Starbucks' willingness to resume contract negotiations, substantive agreements have yet to be reached. The SOC claimed that the company's response to unionization efforts has incurred significant financial costs, estimated to be nearly a quarter of a billion dollars, and has adversely affected the brand's value.

Furthermore, a poll commissioned by the SOC revealed that two-thirds of Starbucks customers would be less likely to visit the chain if it were found to have violated federal labor laws.

As the proxy battle unfolds, the SOC cited the expertise of their nominated three candidates in successfully working with unions and navigating labor law issues. 

Starbucks, however, maintained that its current board members possess the necessary experience and expertise to oversee the company's global operations effectively.

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