Coffee Talk: Who Pays for Your Cup of Java?

Would coffee continue to satisfy our palate - would we sip our java in peace - if we knew that the workers who served it to us suffered from aggressive treatment and exploitative wages?

In addition to examining fair trade labels, which highlight attempts to grow coffee beans without relying on slave labor, we ought to also investigate the extent to which the coffee we consume in popular cafe chains rests on the exploitation of employees. Would the coffee continue to satisfy our palate - would we sip our java in peace - if we knew that the workers who served it to us suffered from aggressive treatment and exploitative wages?

Conversations with workers and managers in major coffee chains reveal that Arcaffe seems to treat some 700 employees in 20 branches with unusual fairness. Ilan's House of Coffee, with 160 employees in 12 branches, usually treats its workers with respect, but salaries are low. The Espresso Bar chain also tends to preserve a culture of fairness in its employment practices.

However, two Jerusalem chains, Aroma and Hillel, reveal problematic employment practices that, at times, smack of exploitation. While most of their branches are franchises and not directly owned by the Aroma and Hillel chains, the chains still appear to be responsible for employment standards in each of the branches in their name.

The Aroma chain has 60 branches in Israel, all franchises, and the chain employs a total of 1,500 workers. Employees of the Aroma on Hillel Street in Jerusalem describe rude, aggressive behavior on the part of management. The employees are paid a minimum hourly wage of NIS 17.93, but half an hour is deducted from their paychecks to cover their daily break and they do not receive additional wages for overtime. They are permitted to eat only one sandwich or salad during their shift and required to pay for soft drinks.

Tzion Cohen, owner of the Jerusalem branch of Aroma, does not deny that he pays employees for a seven and a half hour shift rather than the eight hours required by law. "I pay them for the hours they work - not for the break," he says. He believes that this deduction is standard practice in the marketplace, and completely above board.

He also maintains that employees drink free coffee. He admits that he charges workers for soft drinks, but says that he charges them half price. The sandwich that they are permitted to eat, he says, "is enormous. I myself cannot finish it." According to Cohen, workers are paid for overtime hours. He responds to allegations of inflexibility with respect to workers. "Fifteen employees were fired this year because of misconduct, inappropriate treatment of clientele, mistakes made in preparing sandwiches and throwing them in the trash as a result. I demand professionalism and credibility - anyone who doesn't stand the test has to go."

Employees in the Jerusalem branches of the Cafe Hillel chain (11 branches, two owned by the chain and the remaining nine franchised, about 450 employees) describe relations fraught with contempt and exploitation on the part of management. Potential employees are paid only NIS 16.50 per hour during training shifts, and earnings from these shifts are deducted from the final salaries of employees who do not remain in their positions for at least six months. Every employee must pay a NIS 100 deposit for an apron and shirt bearing the chain's logo, and the deposit is not always returned after the employee leaves. Cafe Hillel does not pay additional wages for overtime hours, despite the fact that shifts are regularly longer than expected. Reimbursement for transportation is included in the salary - which does not initially exceed minimum wage. There are almost no breaks. The cost of traveling in a taxi on the weekend, when there are no buses, is not reimbursed and there is no additional compensation for working on Shabbat and at night.

"As a shift manager, I received an official salary of NIS 23 per hour," a Hillel employee says. "But I almost never received the net salary that I was owed, and I always worked many more hours than those reflected in my salary." There is a miserly attitude toward food here, as well, says the employee: Workers are not allowed to eat more than one sandwich or salad during their shifts. In addition to all that, payment of salaries is regularly postponed. "More than once we received our salaries on the 25th of the month," she says. According to her, it is no wonder that there is such enormous employee turnover at the Cafe Hillel chain.

Cafe Hillel spokesman Guy Tatza says that the chain "believes in fair compensation for employees and preservation of employee rights, according to law, in the case of every worker that the chain employs." He maintains, "There is no overtime employment in the Cafe Hillel chain and the employees' diet of food and beverages is varied and suited to the needs of the employee. As far as the deposit is concerned, it is returned to the employee when he returns his apron and shirt, as is the practice at many chains where food is sold." The spokesman adds, "The chain pays no less than minimum wage for training and forbids the deduction of training wages from the worker's salary. In addition, it is forbidden to include transportation fees in the salary and there is no delay in salary payment at the chain. All claims in this matter are being investigated by the accounting department."

According to Nurit Raveh, the owner of Espresso Bar, with six branches and 180 employees, the lowest employee salary is NIS 23 per hour - five shekels above minimum wage. An advancement program in the chain promotes deserving employees to positions of shift manager, assistant branch manager and managing partner. Shifts are six to eight hours long. There is a varied menu of free employee meals. "Our first customer is our worker," Raveh says. "This is one of the basic values of the firm."

Ilan Shenhav, owner of Ilan's House of Coffee, was the first to bring Israel coffee with the fair trade label. He says that he feels pangs of guilt: The minimum wage paid to rookie employees in the chain includes NIS 200 of the tips they collect from clientele. Despite that, an employee at the Ilan's branch in the Ramat Aviv mall describes his work with pride, "There is the possibility of advancement - they groom and train us. This is a good place to work," he says.

Shenhav says that new employees advance very quickly from a starting position: "Junior Baristas" are promoted to a coaching position within three to four months. From there, they are promoted to shift managers and later, to instructors in the chain's "coffee school." Employees may also attend a course to become a "Master Barista" and advance to the position of branch manager. Promotions are accompanied by increases in salary and bonuses based on the amount of coffee sold and performance in standards of quality, including cleanliness and service. "All of the managers, to date, were hired in house," Shenhav says.

The chain that gets an excellent grade for its treatment of employees is Arcaffe, which celebrated its 10th anniversary two weeks ago. Arcaffe marketing director Hagit Fuchs describes the firm's employees as the "cafe commando force." This is her way of saying that the chain instills a sense of identity and pride in its employees not unlike that of an elite unit in the Israel Defense Forces. Fuchs also says, "Our first customer is our worker."

According to her, the first salary level is "higher than what is common in the market," despite the fact that it barely exceeds minimum wage. Tips are not included in the salary (few though they are anyway). Workers enjoy a fast promotion track: From bartender to shift manager, assistant branch manager, branch manager and finally regional manager. Fuchs notes that Arcaffe CEO Tal Frost began his career as a bartender. Most of the managers progressed among the rank-and-file.

Arcaffe shifts are seven hours long and employees eat and drink "whatever they like" when the shift ends. Employees also receive discounts on merchandise sold in the firm and the firm invests in a host of social activities including parties, "fun days," excursions and training trips to the roasting factory in Italy. At the 10th anniversary party, two weeks ago, participants noted another interesting phenomenon: There are at least four married couples who met at work at Arcaffe. Employee turnover is slow and many of the employees have been working in the chain for five years or longer. Fuchs says that the chain does everything it can to create a good working ambience so that workers' smiles will be natural, not forced.