The fact that
German unions are striking over pay rates in Amazon’s warehousesin that country is easy to dismiss: Everyone knows that Amazon is the very model of modern innovation. And
Germanunions? Please. Don’t make us laugh.
But hold that thought. Because Amazon is such a big employer — it has nearly 100,000 workers — the way Amazon treats its workers is becoming a big issue, and Amazon needs to tackle it head-on before its reputation is damaged and it becomes “the Walmart of the Web.”
- Gawker has published a brutal series of emails describing life inside America’s Amazon warehouses, where temp employees toil in freezing conditions. Their rest and lunch breaks disappear because Amazon’s warehouses are so big its takes several minutes of walking to get to and from your work-station.
- Pennsylvania’s Morning Call published a series of stories about Amazon warehouses that were so hot workers fainted on the job and were placed on stretchers by paramedics. (Amazon has since installed air conditioning.)
- Amazon’s temp agency aggressively opposes unemployment compensation for workers who were let go because they were sick, The Morning Call reported.
- Mother Jones did an in-depth piece that described how Amazon workers are fired if they burst into tears on the job. (“There’s 16 other people who want your job. Why would they keep a person who gets emotional, especially in this economy?”)
- One account of being trained at an Amazon warehouse compared it to being in prison: “My initial thought was this is prison, the comparisons were obvious. I felt like asking anyone sitting by me or standing in line next to me ‘so, what are you in for?’ It would have been a completely appropriate question.”
- And it’s not just the warehouses. We recently published portions of an email from an Amazon temp developer, who explained that because Amazon only seems to hire temps, the pay and the quality of work stay low.
Amazon warehouse workers are paid $US11 an hour in the U.S. That’s far higher than the $US7.25 federal level. But that’s not the point. From Amazon’s point of view, embittered temp workers are going to publish nightmare-ish tales of working at Amazon far faster than Amazon’s media relations people will be able to rebut them. The fact that Amazon often places its warehouses in semi-rural/suburban areas where there are few other jobs hurts the company, too. It makes people feel like the exploitation is the whole point, not an accidental side effect of trying to save money.
And then there are the margins. Amazon’s operating income in 2012 was just 1% of revenues. Walmart’s was 6%. Amazon has thinner margins than Walmart. That suggests Amazon is even more incentivized to exploit its workers than Walmart is — it has less room for error.
Amazon needs to get ahead of this. It has taken years for CEO Jeff Bezos to build Amazon into the success story that it is. It could take just a few months for its brand name to be turned into a byword for chiseling. Now is the time to act, before things get out of control.
Disclosure: Jeff Bezos is an investor in Business Insider through his personal investment company Bezos Expeditions.