In a significant move that could redefine labor relations for gig economy workers, the National Labor Relations Board (NLRB) has determined that Amazon is a joint employer for subcontracted drivers delivering packages in California. This pivotal decision counters Amazon's longstanding assertion that delivery drivers are employed solely by third-party Delivery Service Partners (DSPs) and not by the company itself.
The ruling stems from an investigation launched after the Teamsters union filed multiple unfair labor practice charges against Amazon, alleging extensive control over its drivers. Of the over 275,000 drivers employed through various DSPs, many have raised concerns about work conditions and management practices.
The Teamsters, known for representing workers in various transport industries including UPS drivers, have particularly criticized Amazon's operational model, which relies heavily on outsourced delivery methods. They argue that Amazon’s decision-making extends to dictating routes, setting delivery goals, and assessing driver performance — elements typically associated with employer responsibilities.
In 2023, the Teamsters succeeded in unionizing several drivers from a DSP in Palmdale, California, named Battle Tested Strategies. However, relations between Amazon and the union took a contentious turn when Amazon refused to negotiate a union contract, prompting further scrutiny from regulators.
In recent statements, NLRB spokesperson Kayla Blado confirmed that agency prosecutors found merit in three of the unfair labor practices filed by the Teamsters. One key finding was that Amazon, in partnership with Battle Tested Strategies, qualifies as a joint employer of the drivers. This means Amazon may be legally obligated to engage in collective bargaining with the union over the working conditions and operational changes affecting the drivers.
Moreover, the NLRB ruled that Amazon made unlawful threats against unionization efforts and failed to disclose necessary information to the union, impediments to fair collective bargaining processes. There will also be ongoing deliberations regarding Amazon's termination of its contract with the unionized DSP, which could further complicate matters if negotiations do not evolve into a satisfactory settlement.
Despite these setbacks, an Amazon spokesperson, Eileen Hards, declared that they anticipate the remaining allegations would be dismissed when and if litigated. Conversely, Teamster General President Sean M. O'Brien celebrated the NLRB’s findings as a critical advancement for Amazon drivers’ rights, insisting that the ruling affirms their legal right to negotiate.
This ruling not only impacts Amazon but also showcases a broader trend within the labor landscape, with unions increasingly asserting their influence in the gig economy. In 2022, the Amazon labor force was marked by numerous complaints about work pressure and conditions. According to data from the Economic Policy Institute, wage growth for gig economy workers has lagged, often failing to keep pace with inflation, further exacerbating issues faced by these laborers.
As companies cut costs through subcontracting and employ complex labor structures, labor regulators are faced with escalating cases similar to Amazon's. The rise of independent worker classification cases has led to a surge in regulatory scrutiny. For instance, California's Assembly Bill 5 attempted to tighten regulations on worker classification and succeeded in mandating more labor protections.
With Amazon being a cornerstone of e-commerce and logistics, the industry is closely watching how these developments will unfold. If the NLRB moves forward with a formal complaint against Amazon, it might set a precedent for how subcontracted workers across other sectors are classified and protected under existing labor laws.
