A big labor dispute is brewing at a premium Bay Area coffee company.
On Monday, some 60 Verve Coffee workers announced that they have taken the first steps in forming a union in hopes of negotiating better pay and other benefits through a new employment contract.
The initial action, which was delivered via letter to management at participating stores after a busy Labor Day morning shift, so far covers one cafe in San Francisco and two in Santa Cruz, where the company is headquartered. Verve has seven other locations across the state, including two roasteries, that the workers said they are in negotiations with to form a larger “wall-to-wall” group.
Workers leading the effort said in a statement that they felt compelled to organize over claims of pay disparities, inconsistent scheduling, and a lack of corporate transparency, issues they allege management has failed to address.
“We joined Verve because of the ideals you claim to stand for: community, collaboration, and mutual respect,” the statement read. “These attributes are highlighted most notably in Verve’s relationship with growers, and we want them to extend to all of Verve’s employees.”
An official union vote, during which officers will be elected, is scheduled for later this week. The effort is currently limited to Verve baristas, though it could be expanded to include roasters and other workers.
It is unclear if the company will recognize or negotiate with the union. A spokesperson for Verve did not respond to a request for comment.
Meanwhile, Verve Coffee is being audited by San Francisco’s Office of Labor Standards Enforcement for potential violations of the city’s Health Care Security Ordinance — a law which requires businesses with 20 or more employees to set aside money to provide workers with health care benefits in lieu of insurance.
Under the law, employers with 100 or more employees must pay $3.85 an hour to employees who do not receive full-time benefits. Employers can either use that money to pay for an equivalent level of insurance or have it administered by the city for reimbursements for workers’ medical expenses. Other well-known San Francisco restaurants such as Tartine Bakery and Foreign Cinema were previously found to have violated this policy and were ordered to pay former and current workers hundreds of thousands in back pay.
The city labor office does not publicly disclose details about ongoing investigations, but email correspondence reviewed by The Standard show that the city is currently auditing Verve’s health care spending from 2022 to 2025.
Prior to this union action, Verve came under scrutiny in its hometown for recently adding a 5% surcharge on all orders to “help provide health and other employee benefits.” According to an investigation by Lookout Santa Cruz, the charge caused friction between cafe employees and management because many baristas only work part-time and do not qualify for medical benefits.
The company said that 75% of its retail employees are eligible for health benefits but declined to disclose how many receive them.
Verve, which was founded in 2007 by Colby Barr and Ryan O’Donovan, is a private company and has not publicly disclosed its financials. But several industry analysts estimate its annual revenue exceeds $62 million. The company employs more than 250 people.
In comparison, Blue Bottle Coffee, which was acquired by Nestle in 2017, rakes in an estimated $386 million in annual sales. Last month, workers at four East Bay Blue Bottle locations also formed their own union amid allegations of economic exploitation and concerns over health care benefits and staffing.
Roughly two-quarters of Verve’s sales are from its cafes and wholesale business and the remainder are generated online. The company also operates six locations in Japan, and in 2023, started a partnership with Capital One to serve Verve coffee at 50 of the banking giant’s cafes across the country.