Former Manager, Who Was Fired Over Her Race, To Receive $25 M

A court has ordered Starbucks to pay $25.6 million to a former store manager who was dismissed because she was White, according to a jury.

Shannon Phillips, the former regional manager who oversaw hundreds of Starbucks coffee shops, was fired by the business in the aftermath of a 2018 incident at a Starbucks in Philadelphia’s Rittenhouse Square district.

Rashon Nelson, a Black man in his twenties, was waiting for a third party for a business meeting at the Rittenhouse Square Starbucks when he was denied access to the restroom since he hadn’t purchased anything.

A store clerk then approached Nelson and his business partner, Donte Robinson, and asked if they needed assistance. The pair declined.

Police arrived shortly after, after being alerted by Starbucks personnel, handcuffed the pair, and took them from the cafe.

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Their arrests were documented on camera and extensively disseminated. Protests erupted, and the firm closed all of its stores to do anti-bias training for employees.

Phillips, the regional manager, was fired, while the Black manager of the Rittenhouse Square coffee shop was retained. Phillips filed a lawsuit against Starbucks in 2019, stating that her termination was based on her race.

Following the incident with the two Black men, her lawyers claimed that “upper management at Starbucks was looking for a ‘scapegoat’ to terminate in order to demonstrate action was being taken.”

On Monday, June 12, a federal jury in Camden, New Jersey, agreed with their claim and awarded Phillips, the former store manger, $600,000 in compensatory damages and $25 million in punitive damages after concluding that Starbucks violated her federal civil rights as well as a New Jersey law prohibiting racial discrimination.

According to Wilk Auslander employment attorney Helen Rella, the case is uncommon since anti-discrimination rules typically favour blacks or Asians.

“The decision in the Starbucks case, that found Starbucks liable for race discrimination relative to a white employee who was terminated, sends the signal that all races are protected from discrimination – not just those who are considered minorities,” she told CBS MoneyWatch. “It serves as a reminder to employers to carefully consider their actions to ensure that they are compliant with anti-discrimination laws across the board.”

The 2018 incident resulted in a significant public relations disaster for the corporation. Following the arrests, Starbucks took several actions to try to resolve the matter.

Then-CEO Kevin Johnson apologized, calling what transpired “reprehensible” and promised to make all necessary changes to ensure that something similar doesn’t happen again.

Starbucks quickly amended its policy to enable customers to use the facilities and spend time in stores even if they had not made a purchase. The coffee chain also halted over 8,000 company-owned locations for an afternoon to conduct mandatory anti-bias training for approximately 175,000 staff.