Starbucks workers in three states took legal action against the coffee giant Wednesday, saying it violated the law when it changed its dress code but refused to reimburse employees who had to buy new clothes.
The employees, who are backed by the union organizing Starbucks’ workers, filed class-action lawsuits in state court in Illinois and Colorado. Workers also filed complaints with California’s Labor and Workforce Development Agency. If the agency decides not to seek penalties against Starbucks, the workers intend to file a class-action lawsuit in California, according to the complaints.
Starbucks didn’t comment directly on the lawsuits Wednesday, but the company said it simplified its dress code to deliver a more consistent experience to customers and give its employees clearer guidance.
“As part of this change, and to ensure out partners were prepared, partners received two shirts at no cost,” the company said Wednesday. Starbucks refers to its employees as “partners.”
Starbucks’ new dress code went into effect on May 12. It requires all workers in North America to wear a solid black shirt with short or long sleeves under their green aprons. Shirts may or may not have collars, but they must cover the midriff and armpits.
Employees must wear khaki, black or blue denim bottoms without patterns or frayed hems or solid black dresses that are not more than 4 inches above the knee. The dress code also requires workers to wear black, gray, dark blue, brown, tan or white shoes made from a waterproof material. Socks and hosiery must be “subdued,” the company said.
The dress code prohibits employees from having face tattoos or more than one facial piercing. Tongue piercings and “theatrical makeup” are also prohibited.
Starbucks said in April that the new dress code would make employees’ green aprons stand out and create a sense of familiarity for customers. It comes as the company is trying to reestablish a warmer, more welcoming experience in its stores.
Before the new dress code went into effect, Starbucks had a relatively lax policy. In 2016, it began allowing employees to wear patterned shirts in a wider variety of colors to give them more opportunities for self-expression.
The old dress code was also loosely enforced, according to the Colorado lawsuit. But under the new dress code, employees who don’t comply aren’t allowed to start their shifts.
Brooke Allen, a full-time student who also works at a Starbucks in Davis, California, said she was told by a manager in July that the Crocs she was wearing didn’t meet the new standards and she would have to wear different shoes if she wanted to work the following day. Allen had to go to three stores to find a compliant pair that cost her $60.09.
Allen has spent an additional $86.95 on clothes for work, including black shirts and jeans.
“I think it’s extremely tone deaf on the company’s part to expect their employees to completely redesign their wardrobe without any compensation,” Allen said. “A lot of us are already living paycheck to paycheck.”
Allen said she misses the old dress code, which allowed her to express herself with colorful shirts and three facial piercings.
“It looks sad now that everyone is wearing black,” she said.
The lawsuits and complaints filed Wednesday allege that Starbucks’ dress code violates state laws that require companies to reimburse workers for expenses that primarily benefit the employer. Colorado law also prohibits employers from imposing expenses on workers without their written consent, according to that lawsuit. The plaintiffs seek damages on behalf of all Starbucks workers in those states, whether or not their stores are unionized.
Multiple plaintiffs, like Allen, said they requested reimbursement from Starbucks to conform to the dress code but were denied. Gilbert Cruz, an employee in Aurora, Illinois, requested $10 for the cost of removing a nose piercing.
Worker-led lawsuits in state courts are a shift in tactics in the multi-year effort to unionize Starbucks’ stores.
Starbucks Workers United, the labor group that has unionized 640 of Starbucks’ 10,000 company-owned U.S. stores, has filed hundreds of unfair labor practice charges against Starbucks with the National Labor Relations Board. The union filed an charge over the dress code in April but it is not a party in the current lawsuits.
But the board’s ability to hear cases has been curtailed under President Donald Trump. Trump fired an NLRB member in the spring, leaving the board without the quorum it needs to decide cases.
The Federal Reserve cut its benchmark interest rate Wednesday for the first time in nine months. Since the last cut, progress on inflation has slowed while the labor market has cooled. That means Americans are dealing with both high prices and a challenging job market.
The federal funds rate, set by the Federal Reserve, is the rate at which banks borrow and lend to one another. While the rates that consumers pay to borrow money aren’t directly linked to this rate, shifts in Fed policy affect what people pay for credit cards, auto loans, mortgages, and other financial products.
Wednesday’s quarter-point cut is the first since December and lowers the Fed’s short-term rate to about 4.1%, down from 4.3%. The Fed projected it will cut rates two more times before the end of the year.
The Fed has two goals when it sets the rate: one, to manage prices for goods and services, and two, to encourage full employment. This is known as the “dual mandate.” Typically, the Fed might increase the rate to try to bring down inflation and decrease it to encourage faster economic growth and more hiring. The challenge now is that inflation is higher than the Fed’s 2% target but the job market is weak, putting the Fed in a difficult position.
“The dual mandate is always a balancing act,” said Elizabeth Renter, senior economist at personal finance site NerdWallet.
Here’s what to know:
A cut will impact mortgages gradually
For prospective homebuyers, the market has already priced in the rate cut, which means it’s “unlikely to make a noticeable difference for most consumers at the time of the announcement,” according to Bankrate financial analyst Stephen Kates.
“Much of the impact on mortgage rates has already occurred through anticipation alone,” he said. "(Mortgage) rates have been falling since January and dropped further as weaker-than-expected economic data pointed to a cooling economy.”
Still, Kates said a declining interest rate environment will provide some relief for borrowers over time.
“Whether it’s a homeowner with a 7% mortgage or a recent graduate hoping to refinance student loans and credit card debt, lower rates can ease the burden on many indebted households by opening opportunities to refinance or consolidate,” he said.
Interest on savings accounts won’t be as appealing
For savers, falling interest rates will slowly erode attractive yields currently on offer with certificates of deposit (CDs) and high-yield savings accounts.
Right now, the best rates on offer for each have been hovering at or above 4% for CDs and at 4.6% for high-yield savings accounts, according to DepositAccounts.com.
Those are still better than the trends of recent years, and a good option for consumers who want to earn a return on money they may want to access in the near-term. A high-yield savings account generally has a much higher annual percentage yield than a traditional savings account. The national average for traditional savings accounts is currently 0.38%.
There may be a few accounts with returns of about 4% through the end of 2025, according to Ken Tumin, founder of DepositAccounts.com, but the Fed cuts will filter down to these offerings, lowering the average yields as they do.
Auto loans are not expected to decline soon
Americans have faced steeper auto loan rates over the last three years after the Fed raised its benchmark interest rate starting in early 2022. Those are not expected to decline any time soon. While a cut will contribute to eventual relief, it might be slow in arriving, analysts say.
“If the auto market starts to freeze up and people aren’t buying cars, then we may see lending margins start to shrink, but auto loan rates don’t move in lockstep with the Fed rate,” said Bankrate analyst Stephen Kates.
Prices for new cars have leveled off recently, but remain at historically high levels, not adjusting for inflation.
Generally speaking, an auto loan annual percentage rate can run from about 4% to 30%. Bankrate’s most recent weekly survey found that average auto loan interest rates are currently at 7.19% on a 60-month new car loan.
Credit card rate relief could be slow
Interest rates for credit cards are currently at an average of 20.13%, and the Fed’s rate cut may be slow to be felt by anyone carrying a large amount of credit card debt. That said, any reduction is positive news.
“While the broader impact of a rate reduction on consumers’ financial health remains to be fully seen, it could offer some relief from the persistent budgetary pressures driven by inflation,” said Michele Raneri, vice president and head of U.S. research at credit reporting agency TransUnion.
“These savings could contribute to a reduction in delinquency rates across credit card and unsecured personal loan segments,” she said.
Still, the best thing for anyone carrying a large credit card balance is to prioritize paying down high-interest-rate debt, and to seek to transfer any amounts possible to lower APR cards or negotiate directly with credit card companies for accommodation.
Fashion brands are asleep at the switch—and tariff enforcement is the alarm.
Tariffs aren’t just line-items in P&L forecasts anymore. They’re becoming legal landmines for fashion brands that haven’t updated how they source, ship, and declare. DDP missteps, opaque importer-of-record practices, and loose definitions of transshipment are now front and center.
Here’s what’s changing—and what smart brands are doing:
DDP is risky business. Delivered-Duty-Paid sounded nice for customers, but under new enforcement, it can expose brands to unexpected liability, compliance failures, and surprise costs.
Importer of Record (IOR) rules are tightening. If you don’t know who is officially “importer,” which duties are due, or where HS codes fall under new origin rules—you’re vulnerable.
Transshipment definitions are shifting. Countries used to act as “middle stops” for goods. Now those pathways are being audited, challenged, or redefined in ways that can trigger duty if product origin isn’t crystal clear.
You might think your cost-push is mostly raw materials or tariffs. Nope.
Lots of brands will bleed margin (or get blindsided) because they ignored trade compliance operations. The things nobody saw because “it always worked before.”
What to do now to stay safe and lean:
Audit your DDP and IOR contracts—know who’s responsible for what.
Map your supply chain: every country of origin, every possible transshipment route—make them transparent.
Harden your customs paperwork: HS codes, origin declarations, testing documentation. Errors here cost way more than you think.
Lean on nearshore + alternate sources where possible—not just for cost, but for compliance predictability.
Build in compliance into design and sourcing decisions—it should be as fundamental as style or fabric.
Every brand I talk to says “we’re getting ahead.” But price shocks and enforcement notices that come later always hit harder. If you aren’t questioning your trade setup right now, you are wrong-footed.
Gucci just changed captains mid-storm.
Bellettini in. Nine months after the last guy.
Turnaround season starts now.
Gucci pulled a power switch:
Francesca Bellettini is now CEO, replacing Stefano Cantino after just 9 months.
New group boss Luca de Meo moved fast to streamline the org and put a closer on the mound.
Meanwhile, Gucci’s sales are down ~25% YoY two quarters in a row.
The assignment couldn’t be clearer: stabilize, simplify, and make the brand unmistakably desirable again.
Leadership takeaway: when your flagship is drifting, you don’t run a vibe check, you pick a point of view and execute like your P&L depends on it.
If you lead a team (fashion, tech, or anything in between), ask:
What’s our non-negotiable POV?
What decisions get simpler today?
Where are we confusing the customer?
Drop your read on this move below, and follow for more no-fluff breakdowns of big leadership plays.
OAKLEY GLASSES OFFERED FOR SPORT
IMPROVEMENT EXPECTED IN THIRD QUARTER
Apparel giant Gap is aiming to make a splash as it dips into beauty and accessories, touting a slew of new executive hires from top rungs of the two sectors. On the beauty side, the company is adding Nordstrom vet Deb Redmond and Estée Lauder alumnus Jon Demsey, while Reed Krakoff and Michele Parsons will work accessories. The hires come shortly after the company announced it would begin rolling out cosmetics in its Old Navy stores, as Gap looks to claim its share of fashion's "beauty boom."
Following one of the most unexpectedly tumultuous months in the company's history, dining chain Cracker Barrel said it expects declining traffic over the coming year, sending its shares into a slide. The company offered a downbeat outlook even as it reported a better-than-expected 5.4% increase in same-store restaurant sales for the quarter ending Aug. 1, just prior to its short-lived logo change, which sparked severe blowback and led to a drop in sales. CEO Julie Felss Masino thanked Cracker Barrel customers for "sharing their voices" in an investor letter.
Ben & Jerry's co-founder Jerry Greenfield is stepping down after nearly half a century. Greenfield wrote on social media Wednesday that under parent company Unilever, the ice cream maker has not been able to speak out on the social justice issues he sees as crucial to the brand. Unilever's ice cream division, the Magnum Ice Cream Company — which is in the process of being spun off — said it disagreed with Greenfield and wanted to "strengthen Ben & Jerry’s powerful values-based position in the world."