Starbucks to raise wages by 3%; women’s representation in federal roles needs to improve

In this week's HR news round-up: Starbucks offer staff 3% pay rise; women's representation in federal jobs needs to improve; calls come for HR to develop proper AI usage policies:

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Nov 9, 2023
This article is part of a series called The Most Interesting HR Stories of the Week.

Starbucks to raise workers wages by 3% from next year

Coffee chain, Starbucks, which has been facing growing pressure from individual stores to unionize, has announced that the wages of all hourly-paid staff will go up by 3% from next year. Starting on January 1st, all hourly retail staff will get at least 3%, while those with 2-5 years’ employment service will get at least a 5% pay rise. In addition to the pay increase, Starbucks confirmed it would also reduce the minimum number of days an employee must work to qualify for paid vacation benefits. In a statement, Sara Trilling, executive vice president and president of Starbucks North America, said: “Investing in our partners is what drives our success. It’s what makes us all partners. And an important way we do this is by investing in our partners’ journey, to bridge to a better future at Starbucks and beyond.” However, critics have already pointed out the rise is a below-inflation one – with inflation currently standing at 3.7%. It is also expected that the rises will only apply to non-unionized stores. Since 2021, the Starbucks Workers United has organized more than 350 stores employing roughly 9,000 workers.

Women’s representation in the federal sector reveals mixed results

Three separate reports by The US Equal Employment Opportunity Commission (EEOC) finds that three different groups of women – American Indian and Alaska Native (AIAN) women, African American women, and Hispanic women and Latinas, show wildly different participation rates. It found Hispanic Women and Latinas comprised just 4.5% of government employees (compared to making up 6.2% of the civilian workforce), and were significantly under-represented in management positions (3.5%) and executives (1.9%). It found American Indian and Alaska Native Women comprise 0.8% of the federal workforce – double the civilian population, but they still only accounted for just 0.4% of executives (disproportionate to their presence in the federal workforce) and resigned at a higher rate of 3.6% compared to the government-wide average of 2.3%. African American women fared better, accounting for 11.7% of the federal workforce (twice their participation in the civilian labor force), and they accounted for 10.4% of supervisors, 9.6% of managers, and 7.3% of executives.

Academics apologize after using AI to implicate consultancy firms in wrongdoing

A group of academics has been forced to apologize to the ‘Big 4’ consultancies – Deloitte, KPMG, PwC and EY – after using AI to make false allegations about them in a government inquiry. The academics – who work in the field of accounting – relied on Google Bard AI to generate several cases of misconduct used for their submission – including the false accusation that KPMG was complicit in a “KPMG 7-Eleven wage theft scandal” that led to the resignation of several partners. The submission also wrongly accused Deloitte of being sued by the liquidators of the collapsed building company Probuild (but Deloitte has never audited Probuild), while the submission also accused Deloitte of being involved in a “Deloitte NAB financial planning scandal” – even though there was no-such scandal. The sections of the submission that contained false information generated by artificial intelligence will now been removed. A new document is expected to be uploaded to the Senate inquiry website.

…as it’s revealed AI usage is not being backed up with robust policies

Despite generative AI now being used by 65% of businesses – for everything from creating written content (65%) to automate repetitive tasks (32%) and improve decision making (27%) – new research suggests that just 10% of firms have a robust AI policy in place to control its use. The research – Generative AI 2023: An ISACA Pulse Poll – finds that not only is the integration of generative artificial intelligence into business processes widespread, it is also haphazard, and not supported by adequate risk management strategies. This absence of policy, it argues, creates the potential for ‘misalignment between organizational strategy and operational execution’ and also exposes companies to escalated risks, including maintaining ethical standards. The data finds only 6% of organizations provide comprehensive AI training. The finding comes in the same week a survey by Keka, an HR Tech platform provider, found 90% of human resource practitioners voiced concerns about the ethical implications of AI in HR. In spite of this, however, it also found three in four HR professionals accepted that AI and the HR function would have to coexist.

Data finds staff are still living for today, but are increasingly comparing pension benefit offerings

New research into what employees want from their retirement benefits reveals most workers are still fixated on the present, rather than the future, with most (53%) preferring a $500 pay increase over a $500 increase in contributions made to a retirement plan. That said, it also finds employees are scoping out which employers offer the best retirement plans. It finds that despite nearly all HR professionals (91%) believing their organization offers a competitive retirement packages, nearly two-thirds (61%) of employees believe they could find a better package with a different employer. More than a quarter of employers (28%) think increasing education and communications could help to improve their retirement benefits. For employees, the most confusing parts of their retirement plan are withdrawal options, followed by investment options, and plan fees and expenses. Additionally, the findings show that nearly 4 in 10 (39%) employees are unsure if they contribute the required percentage of their annual compensation to receive the full company match, suggesting that more employer communications may be needed.

Actors strike set to continue after talks break down

Hopes that the longstanding actors strike could be halted were this week dashed, when Hollywood studios’ “last, best & final” contract offer was rejected. The negotiating committee for the striking SAG- AFTRA actors’ union said “several essential items” were still to be thrashed out. While no specific details of the film studios’ offer has been released, Variety reports that the studios’ proposals included an enhanced residual bonus for high-performing streaming shows, comprehensive protections on the use of artificial intelligence and the highest increase in minimum residual payments in 40 years. In a statement, the SAG- AFTRA actors’ union said: “Please know every member of our TV/Theatrical Negotiating Committee is determined to secure the right deal and thereby bring this strike to an end responsibly.” But it added: “There are several essential items on which we still do not have an agreement, including AI. We will keep you informed as events unfold.” Since the walkout first began, Hollywood has essentially ground to a halt, with film production delays now starting to cause major headaches for studio executives and cinema chains.

Staff at Google say free speech is being suppressed over Israel-Hamas war

A report in The New York Times claims workers wanting to express support for Palestinians face hostility. Said one software engineer interviewed: “You have to be very, very, very careful, because any sort of criticism toward the Israeli state can be easily taken as anti-Semitism.” According to the newspaper, “In the month since Hamas launched an attack inside Israel, and Israel retaliated with a bombing campaign and invasion of the Gaza Strip, discussion of the topic at Google — for Muslims and Jews — has sunk into a morass of hostility and intolerance.” It says Israeli and Jewish employees have expressed anger over messages posted in Google’s internal channels, including at least one that was overtly ant-Semitic, and a group of workers published an open letter addressed to Google leadership accusing the company of a double standard that allows for “freedom of expression for Israeli Googlers versus Arab, Muslim and Palestinian Googlers.” Pro-Palestinian employees say the company has allowed supporters of Israel to speak freely about their opinions on the topic, while taking a heavy hand with Muslim employees who have criticized Israel’s retaliation in Gaza.

This article is part of a series called The Most Interesting HR Stories of the Week.