Opinion ID: 810675
Heading Depth: 3
Heading Rank: 1

Heading: Starbucks “Agents”

Text: The application of § 196-d to Starbucks ASMs is potentially more vexing than its application to shift supervisors. On the one hand, if Barenboim’s interpretation prevails and an employee with any supervisory functions is deemed an employer’s agent, then, a fortiori, ASMs are ineligible to receive tip-pool distributions because they exercise greater managerial 19 and supervisory authority than do shift supervisors. But if Barenboim’s interpretation of § 196-d is incorrect, and shift supervisors are not agents excluded by law from sharing in a tip pool, then it is not clear that the same conclusion applies with respect to the agency status of ASMs. The record shows that ASMs assist store managers in making hiring and firing decisions, assigning shifts to baristas and shift supervisors, evaluating employee performance, recommending corrective action for employee infractions, and processing payroll. While this means ASMs have greater managerial and supervisory authority than shift supervisors, we nevertheless cannot confidently conclude that they have the degree of authority necessary to be Starbucks agents so as to be precluded by § 196-d from any participation in tip pools, even though some of the gratuities therein were given for service performed by ASMs.2 Winans contends that ultimate managerial power rests exclusively with store managers, and that ASMs do little more than assist them in exercising that power. Starbucks maintains, however, that ASMs are part of a store’s management team and that, despite their lack of final decisionmaking authority, their undisputed involvement in those management decisions is sufficient for them to be recognized as “agents” under New York Labor Law. The parties’ dispute is more legal than factual, with resolution depending on whether New York views final decisionmaking authority as necessary to demonstrate that someone is an 2 We note that whether ASMs, or for that matter shift supervisors, may receive distributions from tip pools in light of § 196-d is a different question from whether Starbucks’s distribution method—by reference to hours worked—is subject to attack. 20 employer’s agent. New York Labor Law § 2(8-a) defines an “agent” as “a manager” without further explanation, and there are no New York court decisions discussing the meaning of the word “agent” in the context of § 196-d. But see In re Starbucks Emp. Gratuity Litig., 264 F.R.D. at 72 (citing prior district court cases requiring employee to have “full authority” to manage and supervise employees to be “employer or his agent” under § 196-d (internal quotation marks omitted)). The parties further dispute the relevance of ASMs’ customer service to Winans’s § 196-d claim. Winans argues that, because ASMs spend the vast majority of their time engaged in customer service rather than managerial tasks, they should be treated the same as baristas and shift supervisors under § 196-d. Although Starbucks does not deny that ASMs spend most of their time serving customers, it notes that store managers, who no one doubts are the company’s agents, also provide customer service. Starbucks further asserts that ASMs are distinguishable from baristas and shift supervisors because ASMs have greater managerial responsibilities and are salaried, full-time employees. The relevancy of ASMs’ customer service responsibilities to resolution of their agency status is not clearly evident from the statute and limited caselaw. The Department of Labor’s Hospitality Wage Order does say that a “food service worker” may be included in a tip pool, N.Y. Comp. Codes R. & Regs. tit. 12, § 146-2.16(b), so long as he is “primarily engaged in the serving of food or beverages” to customers, id. § 146-3.4. Even assuming that the Order governs disposition of this case, much depends on the meaning of “primarily engaged.” The phrase could measure the amount of time that an employee is engaged in customer service relative to other duties, which could favor Winans, or it could refer to the most salient responsibility from the employer’s point of view, which could favor Starbucks in light of its treatment of ASMs as 21 managerial staff. Or it could refer to some combination of these or other measurements. In any event, Starbucks maintains that ASMs cannot receive distributions from tip pools because they are not similar to waiters or busboys as a consequence of their managerial roles. Starbucks does not go as far as Barenboim in arguing that the Department of Labor’s Hospitality Wage Order is ultra vires to the extent it permits captains, who exercise some supervisory functions relative to other waitstaff, to receive tip-pool distributions. But if Starbucks is correct that ASMs are not akin to waiters, busboys, or other “similar employees”—who, if the Hospital Wage Order controls, would include captains—and, therefore, may not receive tip-pool distributions, we would need to identify a foundational principle on which to rest this conclusion. None is apparent from existing New York law. Thus, the same interpretative difficulty is present in Barenboim’s and Winans’s appeals: What factors should a court consider in determining whether an employee is his employer’s agent and, thus, ineligible to receive distributions from an employer-mandated tip pool? Because the meaning of the word “agent” in § 196-d is not settled in New York caselaw, we defer decision and certify this question to the New York Court of Appeals.