Starbucks recently announced a round of corporate layoffs as part of a broader restructuring initiative aimed at reducing organizational complexity. While the company hasn't disclosed the exact headcount impact, the cuts will affect corporate positions while leaving store-level baristas untouched. With notifications expected to roll out by early March 2025, understanding potential severance packages is crucial for those who might be affected. We've compiled an analysis of Starbucks' historical severance trends and how they compare to industry standards. If you receive a package, sharing your offer on fired.fyi, will help others understand how their packages stack up and negotiate effectively.

Starbucks Layoffs 2025: Current Situation

In a letter to employees, Starbucks CEO Brian Niccol highlighted concerns about decision-making efficiency, pointing to problems with the company's current organizational structure. The layoffs are part of a larger strategy to reinvigorate the brand amid challenging sales performance and heightened competition, especially in the Chinese market. While specific details about the scope of layoffs and severance terms aren't public yet, the company plans to communicate these by early March 2025:

Our size and structure can slow us down, with too many layers, managers of small teams and roles focused primarily on coordinating work.

We have recently begun the work to define the support organization for the future. We are approaching this work thoughtfully, but it will involve difficult decisions and choices. I expect that, unfortunately, we will have job eliminations and smaller support teams moving forward. This work will not affect our in-store teams or the investments we are making in store hours.

We will communicate changes by early March. I do not take these decisions lightly, and I appreciate that this will create uncertainty and concern between now and then. I wanted to be transparent about our progress and our plans and ensure that you hear about this work directly from me.

Understanding Starbucks' Historical Severance Practices

While Starbucks doesn't widely publicize its severance details, we can piece together information from various sources:

Executive Severance Framework

Starbucks' Executive Severance Plan outlines benefits for qualifying executive terminations. Benefits typically include 1.5-2x base salary plus target bonus for eligible executives. For context, former CEO Laxman Narasimhan's package following his replacement by Brian Niccol included roughly $10.6 million in salary and bonuses, along with $37,620 in COBRA premium coverage.

Corporate Employee Severance Patterns

For non-executive corporate roles, severance terms vary significantly based on level, tenure, and circumstances. Because public data on Starbucks' corporate severance packages is limited, we encourage you to share your package anonymously if you receive one. From available information, corporate employees typically saw around 2 weeks of base pay per service year plus several months of healthcare continuation.

Store Partner Severance

Front-line store employees generally receive minimal severance, typically 1-2 weeks maximum, plus COBRA and Unemploment Insurance eligibility. However, these roles aren't expected to be impacted by the March 2025 reduction.

Historically, Starbucks' benefits align with its partner-focused culture, though packages tend to be more modest compared to tech industry standards. Within the food and beverage retail sector, however, their offerings are considered competitive.

Industry Severance Comparison

Let's look at how Starbucks' approach compares to other major players in the food service and retail space:

McDonald's

McDonald's maintains a tiered corporate severance structure offering two weeks per service year, with band-specific minimums and maximums:

• Associate and Coordination: 8-20 weeks
• Specialist, Supervisory/Consulting or Management/Advisory: 12-26 weeks
• Direction and Senior Direction: 16-38 weeks
• Leadership and above: 26-52 weeks

Coca-Cola

Coca-Cola implements a grade-based severance system:

• Grade 18+: 104x Weekly Pay
• Grades 15-17: 78x Weekly Pay
• Grades 13-14: 52x Weekly Pay
• Grades 1-12, Retail and Attraction: 2x Weekly Pay per service year (12-52 weeks range)
• Part-time (all grades): 1x Weekly Pay per service year (2-12 weeks range)

Looking Ahead

While we await Starbucks' detailed announcement about the 2025 layoffs, you can help build transparency by submitting past severance data to our database. Though Starbucks typically takes a more conservative approach than tech companies, their packages remain competitive within the food and beverage retail industry. If you receive a package, please consider sharing your offer details to help others navigate their negotiations. As always, we recommend consulting an employment attorney if you have questions about your specific situation.

We wish you the best during this transition period.