After Philz Coffee stripped former employees of any stock earnings when it was sold to a private equity company for $145 million, costing some workers tens of thousands of dollars, baristas will on Friday receive their “thank you” bonuses: $525.
The bonuses will be paid by “Philz Coffee, supported by Freeman Spogli,” the private equity firm that bought the company, according to a press release. They will only cover current workers, not the 10 former employees who had their stock canceled by the deal.
“I personally visited nearly 40 percent of our stores since the acquisition was announced and the thank you bonus of $525 for each barista was well received and appreciated by all of our team members,” wrote CEO Mahesh Sadarangani in a statement to Mission Local on Aug. 13. “I heard from team members that they’ll do things like make an extra student loan payment, buy something special for themselves or make an extra car payment.”
Sadarangani was initially set to receive a pay-out from the deal and put some of the proceeds back into the coffee chain. After Mission Local reported his proceeds, the company announced he would reinvest all of them back into Philz. It is unclear how much he or other executives will receive in the deal.
The $525 bonus for workers is pre-tax and applies to all current baristas. Store managers will get more, several employees confirmed. Employees at the corporate office and roasting plant will also receive bonuses based on rank. The company declined to give specifics in response to an inquiry about what the range of these “thank you bonuses” would be.
But several baristas that Mission Local spoke to were uncertain about the amount they would get for the bonus or said they had yet to receive that information.
“We’d rather be given hard-earned raises than three tanks of gas,” one barista said in response to the bonuses.
Philz Coffee currently has 1,445 employees across its corporate offices, roasting plant, and 79 stores, including 987 baristas. That means its payout for baristas alone will total $518,175.
The company previously said that no employees will be laid off and none of its stores will close as a result of the deal. “It is expected that benefits, pay, raises, hours, and promotions will continue as the company has operated historically,” the press release says.
Mission Local last month broke the story about Philz Coffee’s $145 million acquisition by Freeman Spogli & Co.
Reporting from the Tenderloin. I'm a multimedia journalist based in San Francisco and getting my Master's degree in journalism at UC Berkeley. Earlier, I worked as an editor at Alta Journal and The Tufts Daily. I enjoy reading, reviewing books, teaching writing, hiking and rock climbing.