Amazon has announced changes to its pay and benefits package for hourly employees in its fulfillment and transportation network, which includes a $1.50/hour increase in average base pay to more than $22/hour. Starting early next year, U.S. hourly workers will also receive a free Prime membership as part of their benefits package. This move is seen as a way to further align the interests of Amazon’s workers with those of its customers, ensuring that everyone is a member of the same club.
While the financial impact of offering Prime membership is not significant, it is a symbolic move that highlights Amazon’s recognition of the importance of its front-line workers in bringing the magic of Prime to customers. Other companies, such as Costco, have previously offered similar perks to their employees, reflecting a trend in the industry towards providing additional benefits to hourly workers to enhance their overall experience in the company.
Despite the positive changes for hourly workers in Amazon’s fulfillment and transportation network, delivery drivers who work for independent Amazon Delivery Service Partner (DSP) companies are not eligible for the Prime perk. The company has also not extended Prime benefits to its salaried corporate and tech employees, as well as employees from other subsidiaries like Zoox, Whole Foods, One Medical, or Zappos. However, with this move, Amazon may consider expanding the Prime benefits to more employees in the future.
The number of Amazon hourly workers who will receive Prime benefits is not yet clear, but it is estimated that there are about 800,000 employees in its U.S. fulfillment and delivery network. The perk will kick in after 90 days of employment and will be offered to U.S. full-time, part-time, and reduced-time hourly employees in entry-level positions to supervisory roles, as well as hourly managerial roles. This move has been recommended by logistics industry veteran Gisela Hausmann as a way for Amazon to generate goodwill among its workforce.
The union movement within Amazon, such as the Amazon Labor Union (ALU) and the involvement of the International Brotherhood of Teamsters, is an important factor to consider in the broader context of labor relations within the company. The ALU recently achieved a historic victory at a Staten Island warehouse, while other unionization attempts have faced challenges. The decision to offer Prime membership as a benefit to hourly workers may be seen as a strategic move to enhance the overall satisfaction and loyalty of employees to the company, amidst the growing labor movement within Amazon.
Overall, Amazon’s decision to offer free Prime membership to its hourly workers is a significant move that reflects the company’s recognition of the importance of its front-line employees in its fulfillment and transportation network. By providing additional benefits, such as healthcare benefits and a 401(k) program, along with the Prime membership, Amazon aims to create a more positive work environment for its employees. This move may also have implications for the broader labor relations landscape within Amazon and the retail industry as a whole.
