Even in defeat, a union drive at Amazon’s Bessemer, Alabama, warehouse may have changed how Amazon treats its employees.
In his final letter to shareholders as Amazon’s CEO — and his first public statement since the closely watched union push in Bessemer failed last week — company founder Jeff Bezos implicitly responded to some of the workplace grievances raised by union organizers.
Amazon needs “to do a better job for our employees,” Bezos wrote, noting he does not “take comfort” in the outcome of the Bessemer union drive. “While the results were lopsided and our direct relationship with employees is strong, it’s clear to me that we need a better vision for how we create value for employees.”
In addition to being “Earth’s Most Customer-Centric Company,” he wrote, “we are going to be Earth’s Best Employer and Earth’s Safest Place to Work.” Bezos will focus on achieving those goals after he steps down as CEO later this year, he wrote. Bezos will remain chair of Amazon’s board of directors; Amazon Web Services (AWS) Director Andy Jassy is replacing him as CEO.
The letter, released Thursday alongside information for Amazon’s May 26 shareholder meeting, was also notable for its omissions. It did not mention the antitrust scrutiny gathering around Amazon. Nor did it reference calls for Amazon to examine racial and gender disparities in its hiring and promotion practices, a key issue among union campaigners and employee activists.
“To truly be employee-obsessed and put employees first is to have a focus on the diversity of all employees,” Charlotte Newman, a Black AWS employee who last month sued Amazon over allegations of racial discrimination and sexual harassment, said in an interview Thursday. “I think this matters most to a company that has as broad a footprint as Amazon does. Business leaders at the company should have as diverse a set of experiences and perspectives as the customers we strive to serve.”
In his letter, Bezos discussed warehouse worker injuries and wages, issues that union organizers had stressed during their campaign. Media reports and government agencies have shown that injury rates in Amazon facilities exceed warehouse industry norms. Bezos committed the company to reducing repetitive-stress injuries incurred in Amazon’s roughly 1,500 fulfillment centers worldwide. Amazon will invest $300 million in safety projects this year, Bezos wrote.
Amazon’s $15 starting wage, more than double the federal minimum wage and among the top hourly minimums in the retail sector, is less than workers typically earn in the warehouse industry. Still, Amazon’s $15 hourly minimum “boosted local economies across the country,” Bezos wrote, including by leading other employers to adopt higher wages. “And we’re not done leading,” he wrote, including on wage growth.
The letter also touched on climate change, describing Amazon’s efforts to reduce carbon in its energy and transportation infrastructure — including by purchasing 100,000 electric delivery vans — and spur the development of new technologies to reduce emissions and remove carbon dioxide from the atmosphere.
And the letter included a nod to Jassy “for agreeing to take on the CEO role. It’s a hard job with a lot of responsibility. Andy is brilliant and has the highest of high standards.”
Jassy was awarded stock options worth $35.6 million in 2020, according to Amazon’s proxy statement, in recognition of the ongoing success of AWS. But Jassy was not Amazon’s highest-paid employee in 2020: Retail chief Dave Clark, who piloted Amazon’s delivery services through the pandemic, was awarded stock options worth $46.1 million. Amazon Chief Financial Officer Brian Olsavsky and General Counsel David Zapolsky each received stock options worth $17 million. Bezos, whose ownership of 14% of Amazon’s stock makes him the world’s richest person, took his normal salary of $81,840.
In his absence from the day-to-day minutiae of running Amazon, Bezos cautioned shareholders and Amazonians against abandoning “distinctiveness” to court popular opinion.
None of Amazon’s success was “preordained,” Bezos noted. When the company went public in 1997, features like its Prime service, which now boasts more than 200 million subscribers, “weren’t even ideas.” Amazon’s success has been the result of risk, sweat and ingenuity, he wrote.
“The world will always try to make Amazon more typical — to bring us into equilibrium with our environment,” he wrote, quoting a passage from atheist philosopher Richard Dawkins describing a struggle against equilibrium as a struggle against death. “It will take continuous effort, but we can and must be better than that.”
What some have described as Bezos’ brilliant iconoclasm, others have characterized as a reluctance to absorb criticism. Amazon shareholder proposals for the company’s 2021 meeting indicate the company has not vanquished critiques of its partnerships with law enforcement, its role as a polluter, and racial and gender pay disparities among its employees.
Amazon in recent years has emerged as a target for activist investors. This year was no exception. Shareholders submitted 17 proposals, roughly on par with the number of proposals submitted in the past two years.
Amazon successfully appealed to the Securities and Exchange Commission to bar seven from appearing for a vote. Some of those asked Amazon to hire employees from a more diverse pool of candidates, publish data related to how pollution from Amazon warehouses affects communities of color and review Amazon’s treatment of whistleblowers and employee activists. The National Labor Relations Board found last month that Amazon illegally fired two employees who had criticized the company’s treatment of warehouse workers.
The company recommended votes against the remaining 10 proposals, including calls for the company to conduct a racial equity and civil rights audit of Amazon’s business practices; disclose how much employees of different races and genders are paid and how quickly they’re promoted; and determine whether Amazon products with facial recognition and surveillance capabilities infringe on human rights.
No previous shareholder proposal from an activist Amazon investor has received a majority of votes, but activist investors say they’re more interested in drawing executives’ attention to issues of concern than winning a vote count. Even successful proposals are advisory in nature, meaning a company can opt against implementing them.
And proposals can give shareholders a degree of leverage over a company: Amazon and 34 other companies agreed last year to release granular employee diversity data after New York City comptroller Scott Stringer threatened to lodge shareholder proposals and vote no on the companies’ candidates for board of directors if they did not.