Economy & Business

Amazon Raises Wages for Employees after Failed Union Vote

An employee scans packages at Amazon’s JFK8 distribution center in Staten Island, N.Y., November 25, 2020. (Brendan McDermid/Reuters)

Amazon is increasing pay for hundreds of thousands of workers after employees at an Alabama plant overwhelmingly rejected unionization earlier this month.

The company has promised permanent pay raises of between 50 cents and three dollars an hour, according to statement from Amazon’s VP of People eXperience and Technology, Worldwide Consumer Darcie Henry. Amazon still plans to maintain a starting wage of $15 an hour.

Amazon also intends to expand hiring for “tens of thousands of jobs across our operations in the US,” Henry confirmed.

An Amazon spokeswoman told The Wall Street Journal that the company decided to bump up the time window for pay increases rather than wait until the fall. She did not indicate whether the decision was connected with the failed union vote at the Bessemer, Ala. warehouse.

“Amazon didn’t win—our employees made the choice to vote against joining a union,” the company said Friday.

The union in question, the Retail, Wholesale and Department Store Union (RWDSU), has filed challenges in the aftermath of the Amazon union election, alleging that the company used intimidation tactics to pressure employees into voting down the initiative. The National Labor Relations Board is scheduled to review the evidence and testimony in a hearing next month to determine whether to certify the election outcome.

Pro-union employees’ original complaints involved company pay policies, the package preparation process, and shift schedules.

“While the voting results were lopsided and our direct relationship with employees is strong, it’s clear to me that we need a better vision for how we create value for employees—a vision for their success,” Amazon CEO Jeff Bezos wrote in a letter to shareholders. Bezos said that the union vote indicated the company’s need for a better vision for how to “create value” for its employees.

Amazon’s robust financial performance during the pandemic enabled it to improve compensation for workers. The additional $1 billion investment in pay raises it pledged on Wednesday amounts to about ten percent of its net profit increase last year.

The company similarly bolstered wages in 2018, when it upped the hourly rate to $15. Amazon has joined the coalition of tech companies advocating for a raise in the federal minimum wage, which currently sits at $7.25 an hour.

The pay announcement came just before the Amazon’s first quarter earnings release, scheduled for Thursday.

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