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The world's largest coffeehouse chain, Starbucks, has been told to pay over $25.6 million in compensation to a former employee who was unfairly fired in 2018. The ruling comes after a six-day trial in a 2019 lawsuit filed by Shannon Phillips, a former regional manager at the coffeehouse chain.
The lawsuit is linked to the arrests of two black men at a Philadelphia store in 2018. The two men were arrested when the store manager called the cops because they had been sitting in the store for quite some time without placing any orders. Following the high-profile arrest, the company received major backlash both from the media and the public.
While Shannon Phillips was not involved in the arrests, she was later fired when she refused to comply with an 'unjust' order from the company. Philips, who was a regional manager for Philadelphia, southern New Jersey, and one other region, was ordered to put a white district manager on administrative leave for reasons that were wrongful and false.
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The company was looking forward to suspending the district manager based on the allegations that black store managers received a lower payout than white managers. However, Philips was against the argument, as the district manager had no power to decide the salaries of employees. It is to be noted that the district manager was also not involved with the arrests in any manner.
Starbucks racial discrimination lawsuit: Federal jury awarded Shannon Phillips $600,000 in compensatory and $25 million in punitive damages
Shannon Phillips, a former regional manager at Starbucks, is eligible to receive over $25.6 million in punitive damages and over $600,000 in compensatory damages after a ruling in a New Jersey court last Monday. The NJ jurors unanimously ruled in favor of Phillips after a six-day trial, where they found that the determining factor behind the firing was race.
The coffeehouse chain was found guilty of a violation of both federal and state anti-discrimination laws after it fired Shannon Phillips and several other white employees during the 2018 racial discrimination backlash. As per Phillips' lawyer, Laura Mattiacci, the company used these employees as sacrificial lambs to calm the outrage and make the community believe that they had taken action.
At that time, Starbucks tried to divert the allegations by saying that the situation demanded someone who had a track record of “strength and resolution.” As per the company, they replaced Shannon Phillips with someone who was fit for such situations and even had experience navigating the aftermath of the 2013 Boston Marathon bombings.
The company's argument didn't seem very convincing after a black district manager responsible for the 2018 arrests gave their testimony. According to the manager, Phillips was loved by all her peers and coworkers, and she was continuously working around the clock to manage the crisis following the arrests.
As mentioned earlier, Phillips will be awarded a sum of over $25.6 million in punitive damages and over $600,000 in compensatory damages. The judge may also consider awarding over $3 million for lost pay, along with the attorney's fee. Starbucks has yet to share any comments on the matter.
