How Amazon is growing its power during the pandemic

How Amazon is growing its power during the pandemic

Rolling back worker raises, pushing Congress to protect it from lawsuits — and selling way more stuff

There’s a lot of discussion going on right now about what will be forever changed by the pandemic. Over at Amazon, though, the company is promising that things are going back to normal.

For one, the company said on Tuesday that delivery times — which have understandably stretched from days to weeks amid the huge logistical challenges posed by COVID-19 — were about to get shorter. Here’s Spencer Soper in Bloomberg:

The company on Sunday lifted restrictions on the amount of inventory its suppliers can send to Amazon warehouses and is shortening delivery times — which had stretched for weeks for some products since the outbreak began — back to days. The shares rose 2.1% to $2,406 at 10:42 a.m. on Wednesday. […]

“We removed quantity limits on products our suppliers can send to our fulfillment centers,” Amazon spokeswoman Kristen Kish said in an email. “We continue to adhere to extensive health and safety measures to protect our associates as they pick, pack and ship products to customers, and are improving delivery speeds across our store.”

Among other things, improving delivery times is an important matter of reputation for Amazon. “Shoppers left 800,000 negative reviews on Amazon’s shopping site in April, double the number in the same month a year ago, with much of the increase attributable to longer delivery times,” Soper writes. That has created an opening for its rivals, including Shopify, Target, and Costco, which have all grown faster in the past two months than Amazon has, according to a separate report in Bloomberg last week.

Unfortunately for workers, getting back to normal has a significant downside — one that goes beyond having lots more boxes to pack and deliver on one- and two-day deadlines. After increasing warehouse workers’ pay in recognition of the increased risks they faced by simply coming in to do their jobs — and routinely calling them “heroes” in public communications — Amazon said Wednesday that their $2 per hour hazard pay would go away in June. Jason del Rey broke the news at Recode:

Asked why the pay bump won’t continue into June, an Amazon spokesperson did not answer the question directly.

“This appreciation and pay incentive enabled us to deliver essential items to communities during these unprecedented times,” the spokesperson said in a statement. “We are grateful to associates supporting customers during a time of increased demand, and are returning to our regular pay and overtime wages at the end of the month.”

If the hazards that come with working in confined spaces are expected to disappear in June, it’s news to me. More than 130 workers are believed to have been infected in outbreaks at Amazon facilities to date — the company won’t disclose the actual number — and at least one has died. And local governments are planning for much longer periods of lockdown. Just yesterday, Los Angeles county said stay-at-home orders would likely continue through August, albeit with some restrictions lifted.

But if Amazon is eager to get back to normal, states attorney general are more skeptical. Here’s Chris Dolmetsch at Bloomberg: is being asked by several U.S. states to provide information about health and safety measures following the death of a number of workers from coronavirus-related illnesses.

Led by Massachusetts Attorney General Maura Healey, 13 states on Tuesday sent a letter to the company expressing concern about recent media reports of “inadequate safety measures and sick leave policies, insufficient data about infections and deaths among their workers, and retaliation against workers who call attention to unsafe workplace conditions.”

The prospect of a fight with states over labor issues comes in addition to similar questions the company has faced in France, where courts required it to close warehouses last month amid complaints the company had not done enough to protect workers. Questions like these don’t seem to be going away — even if they don’t seem to have slowed down Amazon very much so far.

Is there anything Amazon would like to change amid the pandemic? Well yes, actually: it would like to be exempt from lawsuits over price gouging. Here’s Chaim Gartenberg at The Verge:

Amazon has requested that Congress pass a law that would make price gouging illegal during times of national crisis, in light of inflated prices on crucial goods like hand sanitizer and N95 masks that have hounded the online retailer during the COVID-19 pandemic.

In an open letter posted by Brian Huseman, Amazon’s VP of public policy, the company highlights its own ongoing efforts to try to crack down on price gouging. To date, Amazon says that it’s removed half a million price-gouged listings from its online stores and has banned 4,000 seller accounts on its US store alone for violating its Fair Pricing Policy. And as CEO Jeff Bezos noted in a letter to investors, Amazon has set up a special line of communication for state attorneys general to directly pass along price gouging complaints. […]

Unsurprisingly, Amazon’s proposed legislation would ensure that only the party that sets the price — like, say, a bad third-party Amazon retailer — be held liable for the inflated price, not the storefront (i.e. Amazon) that hosts that seller and facilitates the sale.

An emerging theme of this newsletter during the pandemic is that at the same time tech companies are legitimately working to hold society together, they’re simultaneously finding new opportunities to entrench their power — and unwind the criticisms that they have grown too large and must be broken up.

Amazon is the least worried about optics of any big tech company, and in all its big, clumsy moves over the past week, you can see exactly how it believes all of this is going to play out: with Amazon on top and its workers resigned to taking what they can get. And if it succeeds, the new normal will look a lot like the old one.

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