The company that holds the franchise for Starbucks in Chile has suspended the contracts of 90% of its employees in the country, where most cafes are shut as part of efforts to fight the coronavirus epidemic, local media and a union said on Friday.
Mexico's Grupo Alsea said it would honour March salaries and pay 10% of salaries for Chilean Starbucks workers in April, according to a statement seen by local newspaper Diario Financiero.
Grupo Alsea said the move was a "responsible measure" aimed at safeguarding positions across more than 120 outlets around Chile and it hoped to restart the contracts once the coronavirus crisis had passed, the statement added.
A union representing Starbucks workers said in a statement sent to Reuters that the suspension affected 1,600 people, around 90% of the franchise's Chilean workforce.
Andres Giordano, president of the union, said the company continued to do business through deliveries and its "arbitrary" action, without discussion with the union, had "heightened uncertainty for workers and their families."
Neither Starbucks Chile nor its operator Grupo Alsea returned a Reuters request for comment.