At this point I think we’ve all heard something shady about Amazon. A hint of unethical practice, a stray article about something in their warehouses. But when a mega-corporation starts to become pervasive and ever present in our daily lives it’s hard to imagine an alternative. Amazon has reached such a height that for many it may seem like a necessary evil in modern society, and it can almost seem fruitless to learn why they are problematic. If it’s unavoidable, better to not know just how bad it is.
But here’s the thing: for some of us, Amazon is avoidable.
Amazon thrives off convenience and low prices, meaning that for certain members of society it really can function as a valuable tool due to their lack of income or time outside of work, both larger systemic problems that need to be addressed in their own right. But for many of us it’s not necessary for our daily lives. It just isn’t. I’ve now gone for nearly two years without buying anything from Amazon, including digital purchases like Prime, Kindle or Audible and, while some of this is due to my own privilege and living about 5 minutes away from my local high street, it has been achievable.
Beyond questioning the ethics of a business that does best in a hyper-consumerist and unsustainable environment, when you start to look into it properly it seems like nearly everyone who works at Amazon is having a terrible time. Here are the reasons why I choose not to shop on Amazon, which I hope you’ll consider too.
More so than any company I can think of, Amazon appears to have built their profit maximization strategy around avoiding taxes at various levels
Taxes are important. And when the ultra wealthy aren’t paying them, they’re even more important. Taxes redistribute money in such a way that all citizens can receive the services they need (such as education and healthcare), addressing issues like poverty and income inequality by making sure our most vulnerable are able to have their needs met for free. When high earners, or big business, don’t pay their taxes it means there’s less to go around for everyone, and it’s the vulnerable who end up being hurt. Unfortunately not paying taxes is also what corporations apparently love to do (including the ones you think may be ethical, more info on Ecover’s tax avoidance here).
One serial tax avoider is Amazon. In fact it was avoiding tax that got them where they are in the first place. Founded in Seattle by Jeff Bezos in 1994, Amazon was created to exploit the loophole of not having to collect sales taxes when selling online, which at the time was only a requirement for physical stores. Although in the US Amazon now does pay sales tax in every state that has one, calculations suggest that if Amazon had been paying taxes from the start it would have paid a total of $20.4 billion in sales taxes from its founding until 2015.
In the US Amazon also barely pays any federal income tax, both through avoiding booking any profits for years, instead investing everything back into the business, and through aggressive tax planning. According to Matthew Gardner at the Institute on Taxation and Economic Policy Amazon paid no federal tax on $5.6 billion in U.S. profits, and in the past five years paid a rate of 11.4% on its profits of $8.2 billion, around a third of what they should pay.
Beyond this, Amazon is also adept when it comes to playing state and local governments against each other, demanding large subsidies in order to set up an Amazon facility in their area. Good Jobs estimates that Amazon has received at least $1.6 billion in tax incentives, many of which are given in the hope that Amazon’s presence will result in an economic boom and job opportunities in the area. Research suggests, however, that this doesn’t work. There is no return on investment for local areas, in fact it’s a huge waste of money. Employment remains stagnant after Amazon moves in, and economic development doesn’t materialise by incentivising big businesses. Amazon just gets to avoid paying more taxes.
Across the pond in the UK Amazon only paid £4.6 million in taxes in 2017, by routing sales through Luxembourg, a well known tax haven. Almost 75% of Amazon’s 2017 UK revenue, amounting to £6.88bn of UK sales, was registered through their Luxembourg subsidiary. These numbers suggest that Amazon’s tax rate ended up at 0.5%, leaving £50 million of tax unaccounted for. In October 2017 the European Commission also ruled that Luxembourg had improperly allowed Amazon to evade taxes on around 75% of its European profits, and ordered Luxembourg to recover $250 million plus interest from Amazon.
Despite being a huge corporation, with a CEO who is literally the richest man in the world, in the US Amazon also ranks highly on the list of employers with huge numbers of warehouse employees enrolled in SNAP, aka food stamps. In Ohio 1 in 10 employees use SNAP, in Pennsylvania it’s 1 in 9, and in Arizona it’s nearly 1 in 3.
Amazon’s fulfillment center wages are, generally speaking, lower than the average wages for warehouse employees elsewhere. “The average warehouse worker at Walmart makes just under $40,000 annually, while at Amazon would take home about $24,300 a year,” CNN reported in 2013. “That’s less than $1,000 above the official federal poverty line for a family of four.”
A November 2016 study by the Institute for Local Self Reliance, a community development advocacy group, analyzed more than 1,300 wage postings on Glassdoor and found that positions at Amazon’s fulfillment centers paid about 9 percent less than the industry average. And when the researchers homed in on 11 major metro areas to account for differences in cost of living, they found that Amazon’s wage dip was even more pronounced: The company was paying 15 percent less than comparable positions in each area. A January 2018 study by The Economist using different methods found similar results.
While Amazon did announce in 2018 that it would finally be raising wages for warehouse workers, there are still many issues for those who take these jobs.
If you’ve heard something bad about Amazon it’s usually to do with their warehouses, where employees pick and pack products for delivery. There are multiple accounts of abuses at various Amazon warehouses, both in the UK and America, but certain details seem to appear again and again.
Multiple reports can be found of employees pushed to meet extremely high targets, subjected to strict breaks and a terrifying work environment, monitored electronically, and worried that not meeting targets will result in immediately losing their jobs. People talk about peeing in bottles out of fear of being disciplined or terminated for ‘wasting time’ going to the toilet, to the point where employees deliberately decide not to drink water so they don’t have to pee while working. One employee became sick while pregnant and was given a warning, one was hospitalised after having an epileptic seizure at work and received a strike for not showing up the next day, another turned up for work with gastric bug, had to go home after two hours and was given a strike despite getting a sick note from their doctor. One woman tragically suffered a miscarriage while working, which she believed was ‘partly as a result of continuous pressure to hit targets’.
In UK warehouses there are also records of increased depression, anxiety, and suicidal thoughts in employees, alongside bullying and harassment.
The links between Amazon warehouses and ill health is sadly not new. In 2011 staff in a Pennsylvania warehouse worked in 100-degree heat with ambulances waiting outside, taking away workers as they fell. In the UK a 2018 Freedom of Information request revealed that ambulances had been called out 600 times to Amazon’s UK warehouses in the previous three years. The request showed 115 call-outs to Amazon’s site in Rugeley, near Birmingham, in comparison to only 8 calls to a nearby Tesco warehouse of a similar size.
And, heartbreakingly, in 2018 The Huffington Post reported on the case of Jeff Lockhart Jr. In 2013 Jeff, an employee at Amazon’s warehouse in Chester, Virginia, collapsed at work and was pronounced dead less than two hours later. His autopsy cited heart problems as the cause of death, and it’s impossible to know whether the exertion or intensity of the job was a contributing factor. What we do know, however, is that a public records request revealed the following about the Chester warehouse:
In its first two and a half years of operation, more than 180 calls were placed to 911, many of them for patients in their 20s and 30s. The most common issues cited were difficulty breathing, chest pains, cardiac problems, spells of unconsciousness or other undefined illnesses. The frequency of calls tended to climb during peak season.
Beyond suggesting a correlation that can’t be definitively proved, we also know that Jeff’s wife and children were left vulnerable. Jeff was employed as a temporary worker at Amazon, meaning he had no life insurance or health insurance through his workplace. When he died, the family received nothing.
Exploitation of temporary workers
“Somebody did studies and spreadsheets and crunched those numbers,” he said, “and figured out that the cheapest way to get that job done is to treat people like that.”
Jeff’s situation was not a unique one. Amazon warehouses are often staffed by numerous temps hired by external companies who Amazon outsource to. Some of these temps, like Jeff, are hired for the extra work created around the holidays, known as ‘peak season’, and let go shortly after with minimal notice. Some are kept on, as Jeff was, and some are brought in as temps outside of that season altogether. The idea is that eventually these temps should graduate to proper employee status, which will provide more security, better pay and benefits, however there seems to be no proper protocol for how this happens. Jeff had died in January, well after peak season had ended and confident that he would become permanent staff, but there was nothing to indicate if or when this would happen. A separate report talks about other warehouses where no one had been made permanent for 6 months and two years respectively, and past temps from Jeff’s warehouse emphasised that there was no guarantee he would ever have become a permanent employee. It seems this is a common pattern of behaviour for more than one Amazon warehouse (although not necessarily all of them). As his widow explained:
What bothers her most is how expendable her husband seemed to be inside the warehouse system. She believes that had he not died as a second-class temp worker, his family might have been in a better position to sustain the loss. “Just feeling like he wasn’t human, like he was just a piece of paper,” she said. “You know, [they] can dispose of you. It kind of hurt.”
Exploitation of Chinese workers
Amazon also have factories for manufacturing with similar issues to those in their warehouses. Chinese factories often take on temporary workers which are hired from external agencies, known as dispatch workers. It is the law in China that each workplace can’t have more than 10% of their workers be dispatch workers, however an investigation from China Labor Watch found factories in China manufacturing Amazon electronics, such as kindles and smart homes, had workforces that were illegally comprised of over 40% dispatch workers. Working conditions between dispatch and normal workers were found to be decidedly different, despite positions being the same.
The investigation found that regular workers received five days of training while dispatch workers only received eight hours of training, despite the legal stipulation being 24 hours of pre-job safety training. Dispatch workers were also required to pay physical examination fees, take sick leave unpaid, receive no extra wages for overtime, receive no social insurance, and have no contributions made to their housing provident fund (even though dispatch workers are meant to be registered for social insurance and employers are meant to make social insurance contributions). Beyond this, often dispatch workers are sent on leave during the factory’s off season, often for months at a time with no payment.
Despite these differences, all workers in the factories are subject to long hours, low wages, and poor conditions.
Workers put in over 100 overtime hours during peak season, and there was an instance of workers working consecutively for 14 days. The average monthly wage in Hengyang is 4,647 RMB ($725.22 USD), however, workers at the factory on average earned wages between 2000 – 3000 RMB ($312.12 – $468.19 USD) during off-season. As wages are low, workers must rely on overtime hours to earn enough to maintain a decent standard of living. In spite of that, the factory cuts the overtime hours of workers as a form of punishment for those who take leave or have unexcused absences.
Other major issues at the factory include inadequate fire safety in the dormitory area, lack of sufficient protective equipment, absence of a functioning labor union at the factory, and strict management who subject workers to verbal abuse.
A toxic environment for white collar workers
Nearly every person I worked with, I saw cry at their desk.
Outside of blue collar jobs Amazon treats its office staff pretty terribly too. In 2015 The New York Times released a lengthy report on the workplace culture at Amazon’s Seattle offices, and it makes for intense reading.
Interviews with over 100 current and former employees paint a picture of an environment of ‘unreasonably high’ standards and ridiculous working hours (the report details emails arriving after midnight then text messages asking why they weren’t answered, ‘marathon’ conference calls on Easter Sunday and Thanksgiving, criticism from bosses when they can’t reach employees on vacation, and working at home on nights and weekends). Being ‘vocally self-critical’ is described in the leadership principles, workloads are described as ‘extreme’ by employees who used to work on Wall Street, and several fathers talked about leaving as they felt pressure from colleagues and bosses to spend less time with their families. Employees were also often convinced they’d be replaced with younger staff members who could put in more hours. The New York Times interviewed one former employee, a father of two, who wondered whether Amazon would bring in younger workers with fewer commitments. He was 25 himself.
The report also talks about regular meetings known as ‘business reviews’. In these meetings employees were expected to memorise print outs given to them a day or two before, sometimes up to 60 pages long, of data on which they are cold-called and pop-quizzed about. Answers like ‘I’ll get back to you’ were deemed unacceptable in these reviews, and workers were told they were stupid. Multiple people reported people crying in the office.
“The company is running a continual performance improvement algorithm on its staff,” said Amy Michaels, a former Kindle marketer.
Workers are encouraged to tear apart each others ideas in meetings and to send secret feedback to one another’s bosses. The examples given include ‘I felt concerned about his inflexibility and openly complaining about minor tasks’, and interviews with other employees suggest this tactic is often used to sabotage others. You know what other organisation encourages that kind of behaviour? Scientology.
In 2013, Elizabeth Willet, a former Army captain who served in Iraq, joined Amazon to manage housewares vendors and was thrilled to find that a large company could feel so energetic and entrepreneurial. After she had a child, she arranged with her boss to be in the office from 7 a.m. to 4:30 p.m. each day, pick up her baby and often return to her laptop later. Her boss assured her things were going well, but her colleagues, who did not see how early she arrived, sent him negative feedback accusing her of leaving too soon.
“I can’t stand here and defend you if your peers are saying you’re not doing your work,” she says he told her. She left the company after a little more than a year.
Workers are also culled annually. The entire workforce is evaluated, ranked from best to worst, and the bottom performers lose their jobs. Some workers who suffered from personal crises felt they were evaluated unfairly or edged out instead of being allowed to recover. Multiple interviewees described returning from cancer treatment and subsequently receiving low performance ratings and being told their personal life was interfering with their work. Employees returning after serious surgeries and miscarriages were put on performance improvement plans and monitored to ensure their focus stayed on their job. One woman received low ratings after cutting back working nights and weekends to care for her dying father. Another who miscarried twins had to go on a business trip the day after her surgery because she was told the work still needed to be done.
The job culls also lead to a culture of tribalism and scheming in order to ‘take down’ certain employees or survive the ranking process:
Many workers called it a river of intrigue and scheming. They described making quiet pacts with colleagues to bury the same person at once, or to praise one another lavishly. Many others, along with Ms. Willet, described feeling sabotaged by negative comments from unidentified colleagues with whom they could not argue. In some cases, the criticism was copied directly into their performance reviews.
Finally, the report also drew a connection between Amazon’s leadership principles, its job elimination system and its gender gap (the list of officers is comprised of 6 white men and and 1 white woman). Several former and current high level female executives talked about how intangible criteria like ‘earn trust’ or the encouragement to regularly disagree with colleagues worked to their disadvantage, as being a forceful woman often doesn’t go down too well in the workplace, instead leading women to be deemed ‘unlikeable’.
It seems that Amazon has a tendency to rely on data driven methods and analysis for running its operations, but this approach ultimately results in dehumanising employees and disregarding other factors at play, such as race and gender, that unconsciously affect the way business is conducted. This all points to an unfairly weighted, and seemingly awful, place to work. The report also details how many employees don’t last long at Amazon, and jump ship to other organisations such as Google and Facebook.
Delivery drivers & the gig economy
Asides from the employees above, Amazon also employs its delivery drivers through a gig economy system known as Amazon Flex. Operating in a similar way to Uber, it can be used as a source of supplemental income, however it can’t be used to make a living.
One of the reasons that Flex Drivers can’t earn a full living is because Amazon’s algorithms don’t properly compensate them for their work. Like Uber drivers claiming customers, Flex drivers claim blocks of time to deliver certain packages. While Amazon will pay you for the allotted block if you deliver in less time than estimated, these estimates don’t account for factors outside of driving, such as navigating large apartment buildings, leading to a ‘99% probability that you will exceed your block end time.’ If you go over that time, you aren’t paid for it. Drivers across the US have also claimed that hours are capped at 40 hours per week, defeating the notion of freelancers choosing how much and when they work, and an increasing inability to secure enough hours to even make it up to 40.
“When Flex first started all blocks were released at 10 PM. Then they changed to all blocks being released exactly 24 hours in advance. Now they have changed to completely random times”
The increased demand for blocks, and the increased difficulty of securing them, has led to cheating amongst Flex drivers just to get regular hours. Drivers use auto-tap applications (basically the equivalent of botting on Instagram) constantly just to secure work. A former driver who suffers from arthritis also created a mechanical device known as a Flexbot, just to give disabled drivers the chance to compete with able bodied drivers when it comes to tapping on the blocks.
And like its warehouses both domestic and abroad, Amazon has also outsourced finding these drivers to courier services, who then subcontract to drivers. Lawsuits filed in 2015 and 2016 against these courier services named Amazon specifically, and the suits contained complaints such as failure to pay minimum wage, failure to compensate overtime, failure to provide meal periods, employee misclassification, and violations of the unfair competition law.
The source of all of these problems boils down to Amazon’s adoption of a gig economy system: treating drivers as independent contractors without health care, benefits or compensation if injured on the job, but expecting them to do the work of proper employees.
“It’s too bad that Amazon is continuing to pursue these structures, because it doesn’t have to. All it has to do is pay the minimum wage, that’s all,” Ruckelshaus said, sounding defeated. “It seems like they’re jumping through a lot of hoops to avoid being an employer for not really a good economic reason.”
It seems a lot of issues with Amazon workers would be solved if they stopped subcontracting out for temporary and flexible employees. However, perhaps the treatment of permanent staff in their offices suggests that Amazon’s workplace culture would be toxic no matter what, but at least employees might receive slightly better pay or benefits.
Exploiting those who sell on Amazon & those who buy
Not content with hurting just about everyone it employs, Amazon also finds a way to hurt those who sell on their platform and those who buy on it. Research by ProPublica found that Amazon’s algorithm is built in a specific way so that when customers search for something they’re directed towards products from Amazon or sellers who pay for Amazon’s services, even when these items are significantly more expensive than other competitors selling on the site.
We looked at 250 frequently purchased products over several weeks to see which ones were selected for the most prominent placement on Amazon’s virtual shelves — the so-called “buy box” that pops up first as a suggested purchase. About three-quarters of the time, Amazon placed its own products and those of companies that pay for its services in that position even when there were substantially cheaper offers available from others…The average price difference between what the program recommended and the truly cheapest price was $7.88 for the 250 products we tested. An Amazon customer who bought all the products on our list from the buy box would have paid nearly 20 percent more — or about $1,400 extra — than if they had bought the cheapest items being offered by other vendors.
They found that Amazon ranks products by price + shipping, but conveniently omits shipping costs for its own products or those sold by companies that pay Amazon. As competition gets more and more aggressive sellers are forced to join the “Fulfilled by Amazon” programme, which requires paying Amazon to warehouse and ship their products, as it increases their chances of winning the buy box. The fees for the program can amount to between 10 – 20% of sales, meaning that smaller businesses lose money and customers are exploited.
Additionally, when certain products sell well Amazon has also been known to use this data in order to remove any third party sellers from their website, become the only sellers of that product and then raise prices on it, using their own software to leverage monopoly power and earn more money.
What Can We Do?
If you can, stop buying on Amazon
As stated previously, there are people for whom Amazon may be the only option, and that’s ok. This article isn’t for them, because it’s the responsibility of those of us with more privilege to do more about it. All in all, I just don’t want to purchase from any sort of company that avoids that much tax, hurts so many people, and has a lot of money going into political lobbying. Ethical Consumer is running a Boycott Amazon campaign, which encourages you to take your spending elsewhere, and to also let Amazon know why you are boycotting them. They have a really handy shopping without Amazon guide that contains alternatives options for products regularly bought on Amazon. In general, try to look out for locally owned businesses or larger stores that have unions and permanent employees, where workers have proper representation and rights.
Support better public policy
Better working conditions for Amazon employees needs to be enforced through public policy, such as laws on minimum wage, labour standards, and ensuring the gig economy and temporary workers aren’t exploited, as well as making sure those who enforce and monitor these things are properly funded and carry real power. Talk to policy makers and support the ones willing to take on these fights. If you’re in America Alexandria Ocasio-Cortez is a great example of someone calling out Amazon on their ridiculous tax concessions.
Support better tax reporting
Organisations that are campaigning for change point to requirements for companies to publish ‘country by country’ tax reporting, as advocated by the Fair Tax Mark and the OECD, in order for businesses to be more transparent and fair in their tax policies. You can support this push by following Ethical Consumer’s work in this area; choosing to buy from companies who are accredited and letting tax avoiding corporations know that’s why you’ve made a switch. You can even view a map of supporting businesses here. If you run a business you can also apply for the Fair Tax Mark here.
Workers and consumer unions are important in the face of a corporation that deals in data and dehumanisation. Unions hold companies accountable, unions put workers in a stronger position to negotiate, unions can ensure workers receive the benefits they deserve and aren’t subject to inhumane treatment. Unions can also be influential in creating better policies, laws and institutions to keep giants like Amazon at bay. Amazon knows this, because they try to prevent unionisation at every turn. Amazon workers in certain parts of Europe have seen more success in forming unions and striking, consider lending your support to these workers if chances arise.
If you’re a tech worker you can also join the Tech Worker Coalition or Tech Solidarity.
Support your local library!
Many of us use Amazon to buy books, but if you have access to one I encourage you to sign up with and support your local library instead. Not only are libraries a wonderful sustainable option, but they’re also a vital part of society. They offer free educational resources, support healthy and thriving communities, and provide a refuge to the vulnerable in our society. Honestly I think libraries are one of the best things to exist in our society and, as Neil Gaiman explains, our future depends on them. So why not try getting your book fix from your local library instead, and join the fights to keep yours safe here, here, or here.
Break up big tech
This is a biggie, and probably difficult to achieve, but when companies like Amazon start to wield such a huge monopoly, breaking them up is an effective option.
We’ve been here before. There was a time when powerful industrialists gained control of the railroads and exploited that control to limit their competitors’ access to market. Americans responded by using antitrust laws to break up the railroad trusts and stop their anti-competitive behavior, and that’s what we need to do now with Amazon.
Doing so would safeguard the web’s inventiveness and the economy’s dynamism by ensuring that businesses have a chance to emerge and grow without being stifled by a dominant Overlord.
The push to actually do this has to come from activists, small business owners, lawmakers and policymakers, but it can be done. Now, more than ever, is the time to support representatives who believe and push for the same thing.
The problems and power of Amazon seem far reaching, because they are. But it doesn’t mean there aren’t things we can do, and choices we can make, to take back control.