Blue Bottle, Which Raised $45 M, Cut Health Benefits for Part-Timers
Blue Bottle, the artisanal coffee retailer popular with hipsters from coast to coast, just informed employees that part-time workers will not receive health benefits, effective January 2015. A tipster reached out to Valleywag with the news and the company confirmed the change.
This past January, Blue Bottle raised $27.5 million, bringing total funding to $45.7 million. The latest round of investment came from Instagram founder Kevin Systrom and Twitter cofounder Evan Williams, as well as Google Ventures, True Ventures, and a "a group of mutual funds and investment vehicles" put together by Morgan Stanley, according to the announcement in the New York Times.
During the latest round of funding, CEO James Freeman "promoted what he said were improving standards for both coffee and employee services."
In response to questions from Valleywag, a Blue Bottle spokesperson sent the following statement this afternoon:
Earlier this year, Blue Bottle's People Operations Department conducted its first all-company survey to determine what benefits were of highest priority to our employees — from execs to baristas to roasters to production crew.
The top two responses we got:
I. Dependent health coverage (which we're launching now)
- For all full-time employees, Blue Bottle is now covering 80 percent of dependents' health costs. This means spouses, significant others, children, etc. We were not able to do this before, and we're thrilled that we finally figured out a way to swing it — especially since a lot of our folks have families.
II. Retirement benefits (which we're launching early next year)
- We're still hashing out the details of this, but I'd be happy to give you a firmed-up timeline once it's further along.
In order to accommodate these changes, we did indeed have to re-organize our benefits structure. And yes, this means that some part-time employees no longer qualify for coverage under BB. Here's a bit more about that:
The change affects employees who work less than 28 hours per week. There are 84 of these employees. But from that 84, only 19 had ever opted into an insurance plan with us when they were hired. So at this time, 19 of around 340 folks are affected — six percent.
Here are some actions we're taking immediately to accommodate this six percent:
- Our People Ops folks have reached out individually to each of these people to schedule appointments where they'll guide them through Covered California plans (and similar ones in NY). In many cases, these are comparably priced to what our employees were paying with us.
- If any employee wants to increase his/her hours to qualify (i.e. work more than 28), we're making accommodations among different cafes, and with retail managers, to find a place for them to pick up an extra shift or two. From there, they qualify as usual.
- Our People Ops department is hosting several info sessions, as well as assigning one member of each coast's team to be available by phone or Google Hangout for any questions as they arise.
We'd obviously prefer to not shuffle anything around. But given a big increase in premiums we're paying to insurance companies this year (between 12-13 percent since last year), and given the new benefits that our company as a whole asked for, we decided this was the best decision.
For what it's worth, we pay all employees a starting rate of $12 per hour, and we offer paid time off to all employees as well.
Blue Bottle the kind of company that gets loosely clumped into the tech sector and its own listing on Crunchbase merely by virtue of its customer base and financiers. CEO James Freeman says Blue Bottle appeals to what the Times described as "hacking culture":
Why are technology types so interested in the company's decidedly old-school coffee? Mr. Freeman guesses that the care and special attention to detail that his employees pay to the brewing process appeal to hacking culture. It's an attraction that dates back to when Jack Dorsey all but set up shop at the company's Mint Plaza location in San Francisco. ("I would have traded him coffee for a tiny sliver of Square," Mr. Freeman joked.)
The tipster told Valleywag:
tech-SF's well-funded and successful favorite coffee shop, blue bottle, is informing all part-time employees today that they are losing their health benefits, effective january 2015. happy thanksgiving!
It's been an abysmal winter for "contract workers" at a number of venture-backed companies, like Uber and Handy, as well as a publicly-traded companies with market caps in the hundreds of billions, like Google. Meanwhile, health benefits and compensation for the right kind of tech employees has tipped from lavish to absurd.
To contact the author of this post, please email email@example.com.
[Image via Getty]