Amazon is raising the wages of its subcontracted delivery drivers in the United States amid increasing pressure from unions. The drivers working with Amazon’s Delivery Service Partners (DSPs) will now be earning an average of nearly $22 per hour, which reflects a 7% increase from the previous average of $20.50, the company revealed on Thursday. This wage hike is part of a new $2.1 billion investment that the Seattle-based online retailer is putting into its delivery program. Amazon itself does not directly employ drivers; instead, it depends on numerous third-party businesses that handle the delivery of millions of customer packages on a daily basis.
Last year, Amazon also provided a pay raise to their U.S. drivers. In a recent announcement, Amazon stated it would be increasing the wages for frontline workers in the United Kingdom by 9.8% or more. According to Amazon, the DSP program has generated 390,000 driving jobs since 2018, and the company’s total investments of $12 billion since then aim to enhance safety programs and offer incentives for participating businesses.
Regulators in the United States are intensifying their scrutiny of Amazon’s business model, which involves having a degree of separation between the company and the workers operating its distinctive gray-blue vans. Labor groups such as the Teamsters have contended that Amazon exerts significant control over the subcontracted workforce, including determining routes, setting delivery targets, and monitoring performance. They argue that the company should be recognized as a joint employer under the law, a classification Amazon has resisted.
Despite the company’s resistance, labor regulators are increasingly ruling against Amazon. For instance, a National Labor Relations Board prosecutor in Atlanta recently concluded that Amazon should be jointly liable for allegedly issuing threats and other unlawful statements to DSP drivers attempting to unionize in the city. Similarly, NLRB prosecutors in Los Angeles determined last month that Amazon was indeed a joint employer of subcontracted drivers delivering packages for the company in California.
If no settlement is reached in these cases, the agency could opt to file a complaint against Amazon, which would then be addressed through the NLRB’s administrative law system. Amazon retains the option to challenge a judge’s ruling with the agency’s board and potentially escalate the issue to a federal court.
