Starbucks is reportedly cutting down holiday bonuses for corporate employees after reportedly facing one of their worst financial performances since the pandemic in 2020.
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Reports claim corporate employees will only receive 60% of their usual December bonuses. The payouts are usually calculated based on personal performance and company reports, Bloomberg reported. Staffers who met their goals will reportedly receive smaller bonuses due to the company’s weak financial performance this fiscal year. Despite price hikes boosting the average customer spend by 2%, customers are cutting back on Starbucks’s premium offerings.
The chain has also faced boycotts linked to its perceived stance on global conflicts, and CEO Brian Niccol, who took over in September, is planning to revitalize the company. He has previously announced plans to add barista positions to reduce wait times, some of which reportedly stretch up to 40 minutes, and to redesign stores as inviting spaces reflecting Starbucks’ early days.
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“We have a clear plan and are moving quickly to return Starbucks to growth.
The bonus cuts will hit senior executives the hardest, as their payouts rely more heavily on company performance. According to internal documents, U.S. employee bonus targets range from 5% of base pay for rank-and-file workers to 45% for senior vice presidents. Senior executives are also ineligible for merit raises this year.
