Starbucks Plans Raises for Most Employees

Starbucks is giving out raises of at least 5 percent for employees in thousands of stores around the country effective this October.

The announcement was made in a letter to employees from CEO Howard Schultz.

"Earning your trust as partners has always been a foundational principle for me," Schultz wrote. "The world around us is increasingly fragile.

"Our commitment to you is not."

Schultz announced several changes to the compensation program for employees who work in some 7,500 Starbucks stores around the United States:

Effective Oct. 3, all partners and store managers will receive an increase in base pay of at least 5 percent depending on geographic and market factors;

The company will be doubling annual contribution to the stock program for hourly employees who have worked at least two continuous years;

Starting Monday July 18, the company is making changes to its health and benefits program to allow employees "to personalize their health coverage, select an insurance carrier, and choose a coverage level that fits their needs."

Schultz said the combination of these changes will result in compensation increases between 5 percent and 15 percent.

The company is also loosening its dress code and altering its scheduling policy to make sure that employees have the hours that they need.

"I also know how hard you work, and I remain grateful for your continued trust in Starbucks to help you realize your individual aspirations as we work together to realize our shared goals," Schultz wrote.

The news comes as the coffee giant prepares to hike prices on some of its drinks. Some of the increases could be as much as thirty cents.

The new prices - which won't be on all drinks - go into effect Tuesday, July 12.

The last increases came last July.