The relationship between Amazon and drivers for the company’s delivery service partners (DSPs) continues to generate outcomes with potentially major implications.
The most significant development in recent weeks is the decision by a regional office of the National Labor Relations Board that Amazon and one of its DSPs – the companies that actually bring those packages to your door – are joint employers of the DSP workers. It’s the second such decision just since August.
The finding is also directly opposite what Amazon has long claimed: that workers at DSPs are employees of the DSPs, not of Amazon, and that the DSPs are independent businesses not under the control of Amazon.
The director of NLRB Region 10, based in Atlanta, in September made a “merit determination” that workers at MJB LLC, a DSP operating out of an Amazon facility, are joint employees of Amazon and MJB. A group of MJB employees, working with the Teamsters, had sought to unionize at the company.
According to a statement issued by the NLRB at the time of the finding, the director in the more recent finding also uncovered evidence of antiunion activities at the facility.
“The Regional Director found merit to the allegations that the joint-employers unlawfully made coercive statements and gave the impression of surveillance,” the NLRB said. “She also determined that the joint-employers made threats of unspecified reprisal, threats of plant closure…if workers at the location formed a union.”
The NLRB statement makes an important point: that while the question of joint employer status will be crucial, it’s not the only issue between Amazon (NASDAQ: AMZN) and the Teamsters in Atlanta. The question of what a company can do to resist unionization also will be key as the case makes its way through the legal process.
In a prepared statement, Amazon noted that not all of the Teamsters’ allegations were upheld by the regional director. “This complaint makes clear that the Teamsters have been misrepresenting the facts here for over 15 months, which is why the NLRB has not included most of their larger allegations,” Amazon spokeswoman Eileen Hards said in an email to FreightWaves. “As we’ve said all along, there is no merit to any of their claims. We look forward to showing that as the legal process continues and expect the few remaining allegations will be dismissed as well.”
In a revised definition of joint employers put into effect in late 2023, the NLRB said that “two or more entities may be considered joint employers of a group of employees if each entity has an employment relationship with the employees, and if the entities share or codetermine one or more of the employees’ essential terms and conditions of employment.”
The action is the second recent finding of a joint employer relationship. In combination with one from California just a few weeks earlier, it has the broader potential to disrupt the current legal status of Amazon and its DSPs.
In August, a regional director of the NLRB in the Los Angeles region made a similar finding in a case involving a DSP called Battle Tested Strategies (BTS). The director concluded the Palmdale, California, company and Amazon were joint employers.
What happens next
In a prepared statement, the NLRB noted that when a regional director makes a merit determination, it is “the first step in the NLRB’s General Counsel litigating the allegations after investigating an unfair labor practice charge.”
The parties in the dispute then have the option of settling. If not, a formal complaint will be issued and a hearing before an NLRB administrative law judge (ALJ) will be scheduled. The ALJ can “order make-whole remedies.”
Whatever the decision is by the ALJ, it can be appealed to the entire NLRB board. If there is still an unhappy side in the dispute, it can be taken into the federal court system.
BTS case gets its formal complaint
The formal complaint in the BTS case was filed this week by NLRB Region 31. Among its numerous charges, it lays out the heart of the dispute that could have broader ramifications: “At all material times, Respondent Amazon possessed and exercised control over the labor relations policy of Respondent BTS and administered a common labor policy with Respondent BTS for the employees of Respondent BTS at [Amazon’s] DAX8 facility.”
The workers in Palmdale at Battle Tested Strategies were described in a Teamsters statement as the first group of DSP workers who unionized.
Another group of DSP workers who voted in favor of being represented by the Teamsters was in Skokie, Illinois, at a company called Four Star Express Delivery. That ended in a strike and – like what happened at BTS – the termination of the company’s contract to serve as an Amazon DSP.
MJB, at the center of the second NLRB preliminary finding of joint employer status, was the target of a Teamsters unionization drive. But there is no report in the NLRB database of unionization elections of a vote having occurred at MJB.
The drive for unionization of DSPs took another recent step forward in Queens, New York, where workers at three separate DSPs working out of Amazon’s DBK4 facility in September stated their desire to be represented by the Teamsters via a “card check” action.
In card check, workers sign cards stating their desire to become union members. It is controversial because while a worker voting “no” in a secret ballot can keep that desire hidden, an employee acting on that opposition by refusing to sign a card in a card check drive cannot. But it can be accepted by the NLRB as an approved way of a union organizing a group of workers.
The Teamsters, in announcing the action, described the number of workers at the facility as being in the hundreds. (This video reportedly is of a union rally at the Queens facility, though when it took place is not noted.)
Higher minimum pay levels mandated
Amazon recently increased the minimum pay for its DSP drivers to approximately $22 per hour with the help of increasing investments in its “rate cards.” That is up from $20.50.
Hards said the minimums at Amazon are part of an effort to maintain a basic level of pay and that individual DSPs can pay higher if they choose.
“We do have a program agreement, but all our DSPs make decisions on how they schedule their employees, who they hire, what exactly they pay them and all those important employment decisions,” Hards said. “So just because we’re partners and we have high expectations for them does not mean we run their small independent businesses.”
The BTS case is notable because the claim by union bakers is that BTS, having recognized the union after its rank and file had voted to be represented by the Teamsters, had its DSP status yanked by Amazon soon after in retaliation. But the formal NLRB complaint, while noting the termination of BTS’ DSP status, does not say anything to support that claim.
Amazon has yet to sign a collective bargaining agreement with any union. The most significant unionization win was at a Staten Island, New York, warehouse with a successful drive by a grassroots union tied to no national organization. It has since aligned with the Teamsters. But no contract with Amazon has been signed.
Amazon also beat back a highly publicized effort to unionize warehouse workers at Bessemer, Alabama, in 2021. However, that unionization drive was conducted by the Retail, Wholesale and Department Store Workers Union, not the Teamsters.
While there is no clear data, Amazon DSP drivers are believed to be overwhelmingly W-2 employees of their DSPs. Their wages are paid by the DSP as part of a salary or an hourly rate, and their income is reported to them at tax time through an IRS W-2 form from the IRS.
Any drivers working as independent contractors would be considered 1099 workers and receive that IRS form for the purposes of income tax payments.
Some other recent developments with the Teamsters have been mostly positive from the union’s perspective.
It added 160 workers to its ranks when drivers in Florida at Breakthru Beverages voted to align with Teamsters Local 79, according to the union.
And that is just another addition to a Teamsters claim that is difficult to independently confirm: that it has added 50,000 workers as members in the past two and a half years.
Besides traditional outlets for organizing, Teamsters President Sean O’Brien said in a statement that “organizers have also found runaway success bringing more workers into the labor movement at once non-traditional companies, including Amazon, the American Red Cross, Costco, and cannabis dispensaries nationwide.”
More articles by John Kingston
Closures continue on I-40 and I-26 in North Carolina, I-40 in Tennessee
Bill that could hinder warehouse growth in California signed by Newsom