Guardian report exposes Amazon wage increase as public relations fraud

A recent report in The Guardian exposes the fraud of Amazon's October wage hike stunt. It also raises the question: was this all simply intended to stave off a unionization effort that began last summer?

Submitted by Soapy on March 9, 2019

Last October, Amazon made headlines when it announced that it would be raising the minimum wage for all US employees to $15 per hour. In a press release, Amazon quoted its CEO, Jeff Bezos, “We listened to our critics, thought hard about what we wanted to do, and decided we want to lead. We’re excited about this change and encourage our competitors and other large employers to join us."

At the time, the move was greeted with a mix of celebration and skepticism. Some celebrated the move as making good business sense, and also as proof that activism on the part of Bernie Sanders had forced the company to pay its workers more equitably. Skeptics pointed out that the raise in wages was being coupled with elimination of stock options and bonuses for workers, resulting in significant decreases in income.

Now, the story has taken a new turn. A report in The Guardian on Wednesday documents how Whole Foods—acquired by Amazon in 2017—workers are experiencing widespread cuts to hours:

A Whole Foods worker in Illinois told The Guardian:

once the $15 minimum wage was enacted, part-time employee hours at their store were cut from an average of 30 to 21 hours a week, and full-time employees saw average hours reduced from 37.5 hours to 34.5 hours. The worker provided schedules from 1 November to the end of January 2019, showing hours for workers in their department significantly decreased as the department’s percentage of the entire store labor budget stayed relatively the same.

Other workers described similar experiences:

In Maryland, another Whole Foods worker said their regional management is forcing stores to cut full-time employee schedules by four hours, to 36 hours a week. ‘This hours cut makes that raise pointless as people are losing more than they gained and we rely on working full shifts,’ the worker said. Another Whole Foods employee in Oregon noted: “At my store all full-time team members are 36 to 38 hours per week now. So what workers do if they want a full 40 hours is take a little bit of their paid time off each week to fill their hours to 40. Doing the same thing myself.”

The reality being faced by these Amazon workers exposes the fraud of Amazon's October public relations stunt, and raises questions for those argued speculated that the wage increases might have been a way to reduce turnover by treating workers better.

In reality, it seems likely that this cynical ploy was little more than a way for Amazon, and its libertarian billionaire founder Jeff Bezos to head off mounting public pressure, in addition to a Whole Foods unionization effort that began just months before the announcement of the wage increase. The effort was being organized by the Retail, Wholesale and Department Store Union, a 100,000 member union based in New York.

As Shira Ovide of Bloomberg pointed out, the decision to raise the minimum wage must have taken place after Sanders publicly attacked the company in August 2018; the company refused to give credence to Sanders’ accusations of exploitation at the time, a move which would have pointless if minimum wage hikes were on the way. This means that the decision to increase wages took place in the interregnum between the announcement of the unionization drive and October, when the minimum wage hike was announced.

The recent revelations are further proof that corporations cannot be trusted to increase wages and working conditions of their own volition.