More stories

  • in

    California Bill Could Alter Amazon Labor Practices

    The bill would rein in production quotas at warehouses that critics say are excessive and force workers to forgo bathroom breaks.Among the pandemic’s biggest economic winners is Amazon, which nearly doubled its annual profit last year to $21 billion and is on pace to far exceed that total this year.The profits flowed from the millions of Americans who value the convenience of quick home delivery, but critics complain that the arrangement comes at a large cost to workers, whom they say the company pushes to physical extremes.That labor model could begin to change under a California bill that would require warehouse employers like Amazon to disclose productivity quotas for workers, whose progress they often track using algorithms. “The supervisory function is being taken over by computers,” said Assemblywoman Lorena Gonzalez, the bill’s author. “But they’re not taking into account the human factor.”The bill, which the Assembly passed in May and the State Senate is expected to vote on this week, would prohibit any quota that prevents workers from taking state-mandated breaks or using the bathroom when needed, or that keeps employers from complying with health and safety laws.The legislation has drawn intense opposition from business groups, which argue that it would lead to an explosion of costly litigation and that it punishes a whole industry for the perceived excesses of a single employer.“They’re going after one company, but at the same time they’re pulling everyone else in the supply chain under this umbrella,” said Rachel Michelin, the president of the California Retailers Association, on whose board Amazon sits.California plays an outsize role in the e-commerce and distribution industry, both because of its huge economy and status as a tech hub and because it is home to the ports through which much of Amazon’s imported inventory arrives. The Inland Empire region, east of Los Angeles, has one of the highest concentrations of Amazon fulfillment centers in the country.Kelly Nantel, an Amazon spokeswoman, declined to comment on the bill but said in a statement that “performance targets are determined based on actual employee performance over a period of time” and that they take into account the employee’s experience as well as health and safety considerations.“Terminations for performance issues are rare — less than 1 percent,” Ms. Nantel added.The company faces growing scrutiny of its treatment of workers, including an expected ruling from a regional director of the National Labor Relations Board that it unlawfully interfered in a union vote at an Alabama warehouse. The finding could prompt a new election there, though Amazon has said it would appeal to preserve the original vote, in which it prevailed.In June, the International Brotherhood of Teamsters passed a resolution committing the union to provide “all resources necessary” to organize Amazon workers, partly by pressuring the company through political channels. Teamsters officials have taken part in successful efforts to deny Amazon a tax abatement in Indiana and approval for a facility in Colorado and are backers of the California legislation.Both sides appear to regard the fight over Amazon’s quotas as having high stakes. “We know that the future of work is falling into this algorithm, A.I. kind of aspect,” said Ms. Gonzalez, the bill’s author. “If we don’t intervene now, other companies will be the next stage.”Ms. Michelin, the retail association president, emphasized that the data was “proprietary information” and said the bill’s proponents “want that data because it helps unionize distribution centers.”A report by the Strategic Organizing Center, a group backed by four labor unions, shows that Amazon’s serious-injury rate nationally was almost double that of the rest of the warehousing industry in 2020 and more than twice that of warehouses at Walmart, a top competitor.Asked about the findings, Ms. Nantel, the Amazon spokeswoman, did not directly address them but said that the company recently entered into a partnership with a nonprofit safety advocacy group to develop ways of preventing musculoskeletal injuries. She also said that Amazon had invested over $300 million this year in safety measures, like redesigning workstations.Amazon employees have frequently complained that supervisors push them to work at speeds that wear them down physically.“There were a lot of grandmothers,” one worker said in a study underwritten by the Los Angeles County Federation of Labor, another backer of the California bill. Managers would “come to these older women, and say, ‘Hey, I need you to speed up,’ and then you could see in her face she almost wants to cry. She’s like, ‘This is the fastest my body can literally go.’”Yesenia Barrera, a former Amazon worker in California, said that managers told her she needed to pull 200 items an hour from a conveyor belt, unbox them and scan them. She said she was usually able to reach this target only by minimizing her bathroom use.“That would be me ignoring using restroom-type things to be able to make it,” Ms. Barrera said in an interview for this article. “When the bell would ring for a break, I felt like I had to do a few more items before I took off.”An employee sorted items at a Staten Island warehouse in May. Workers have complained that supervisors push them to work at speeds that wear them down.Chang W. Lee/The New York TimesEdward Flores, faculty director of the Community and Labor Center at the University of California, Merced, says repetitive strain injuries have been a particular problem in the warehousing industry as companies have automated their operations.“You’re responding to the speed at which a machine is moving,” said Dr. Flores, who has studied injuries in the industry. “The greater reliance on robotics, the higher incidence of repetitive motions and thus repetitive injuries.” Amazon has been a leader in adopting warehouse robotics.Ms. Gonzalez said that when she met with Amazon officials after introducing a similar bill last year, they denied using quotas, saying that they relied instead on goals and that workers were not punished for failing to meet them.During a meeting a few days before the Assembly passed this year’s bill, she said, Amazon officials acknowledged that they could do more to promote the health and safety of their workers but did not offer specific proposals beyond coaching employees on how to be more productive.At one point during the more recent meeting, Ms. Gonzalez recalled, an Amazon official raised concerns that some employees would abuse more generous allotments of time for using the bathroom before another official weighed in to de-emphasize the point.“Someone else tried to walk it back,” she said. “It’s often said quietly. It’s not the first time I’ve heard it.”The bill’s path has always appeared rockier in the State Senate, where amendments have weakened it. The bill no longer directs the state’s occupational safety and health agency to develop a rule preventing warehouse injuries that result from overwork or other physical stress.Instead, it gives the state labor commissioner’s office access to data about quotas and injuries so it can step up enforcement. Workers would also be able to sue employers to eliminate overly strict quotas.Ms. Gonzalez said she felt confident about the Senate vote, which must come by the close of the legislative session on Friday, but business groups are still working hard to derail it.Ms. Michelin, the retailer group president, said that the Senate committees’ changes had made the bill more palatable and that her members might support a measure that gave more resources to regulators to enforce health and safety rules. But she said they had serious concerns about the way the bill empowers workers to sue their employers.As long as that provision remains in the bill, she said, “we will never support it.” More

  • in

    Amazon Faces Wider Fight Over Labor Practices

    A second union vote may be held at an Alabama warehouse, and new tactics by the Teamsters and other groups aim to pressure Amazon across the country.Since the start of the pandemic, Amazon has ramped up its hiring, bringing on hundreds of thousands of employees worldwide. But challenges to the company’s labor practices are growing quickly, too.Those challenges were underscored when a hearing officer for the National Labor Relations Board recommended a new union election at an Amazon warehouse in Alabama, saying the company’s conduct during the organizing campaign had precluded a fair vote.The board’s regional office will rule on the recommendation in the coming weeks. If it leads to a new election, as seems likely, the union would face long odds of victory. But Amazon faces a widening campaign to rein in the power it wields over its employees and their workplace conditions.Those efforts include a campaign by the Teamsters that would generally circumvent traditional workplace elections and pressure the company through protests, boycotts and even fights against its expansion efforts at the local level. Legislation in California would force Amazon to reveal its productivity quotas, which unions contend are onerous and put workers at risk.Throughout the pandemic, Amazon warehouse workers have protested what they consider unsafe conditions, sometimes resulting in embarrassment for the company, as with the disclosure of notes from an internal meeting in which an Amazon executive called a worker-turned-protester “not smart, or articulate.”In April, the general counsel of the labor board found merit to charges that Amazon fired two white-collar workers who had raised concerns last year about the conditions facing the company’s warehouse workers during the pandemic. The election in Alabama brought intense scrutiny of the company’s labor practices, with even President Biden taking it as an opportunity to warn employers that “there should be no intimidation, no coercion, no threats, no anti-union propaganda” during such a campaign.In a statement after the hearing officer’s recommendation was reported on Monday, Amazon said, “Our employees had a chance to be heard during a noisy time when all types of voices were weighing into the national debate, and at the end of the day, they voted overwhelmingly in favor of a direct connection with their managers.”Since the results were announced in early April, showing that Amazon won by more than two to one, many unions and union supporters have argued that the outcome points to the need for new tactics to organize the company.Perhaps the most prominent voice in this discussion is the more than one-million-member International Brotherhood of Teamsters, which approved a resolution at its convention in June committing the union to “supply all resources necessary” to organize workers at the company and help them win a union contract.The Teamsters argue that holding union votes at individual work sites is typically futile at a company like Amazon, because labor law allows employers to wage aggressive anti-union campaigns, and because high turnover means union supporters often leave the company before they have a chance to vote.Instead, the Teamsters favor a combination of tactics like strikes, protests and boycotts that pressure the company to come to the bargaining table and negotiate a contract covering wages, benefits and working conditions. While the union hasn’t laid out its tactics in detail, it recently organized walkouts involving drivers and dockworkers at a port in Southern California to protest the drivers’ treatment there.They hope to enlist the help of workers at other companies, sympathetic consumers and even local businesses threatened by a giant like Amazon, partly to mitigate the challenges presented by high employee turnover.“Building our relationships within the community itself is the way to deal with that,” Randy Korgan, a Teamsters official from Southern California who is the union’s national director for Amazon, said in a recent interview. “We could have filed for an election in a number of places in the last more than a year, gotten into that process, but we realize that the election process has its shortcomings.”The union believes that it can pull a variety of political levers to help put the company on the defensive. Mr. Korgan cited a recent vote by the City Council in Fort Wayne, Ind., denying Amazon a tax abatement after a local Teamsters official spoke out against it, and a vote by the City Council in Arvada, Colo., to reject a more than 100,000-square-foot Amazon delivery station. While the Arvada vote centered on traffic concerns, Teamsters played a role in drumming up opposition.In California, the Teamsters have joined forces with the Los Angeles County Federation of Labor and the Warehouse Worker Resource Center, an advocacy group, to back a bill that would require certain employers to disclose the often opaque productivity quotas applied to workers, which they can be disciplined or fired for failing to meet. The legislative language makes it clear that Amazon is the main target.The bill, offered by Assemblywoman Lorena Gonzalez, the author of a 2019 law effectively requiring gig companies to classify workers as employees, would also direct the state’s occupational safety and health agency to develop a regulation ensuring that such quotas don’t put workers at high risk of injury. It passed the State Assembly in May and will be considered by the State Senate later this summer.Other labor groups are pressing ahead with less orthodox efforts to increase the power of Amazon workers. Over the first six months of this year, a group called the Solidarity Fund, which raises money from individual tech workers, distributed over $100,000 in grants to workers seeking to organize their colleagues to push for workplace improvements.About half the money, in $2,500 increments, went to workers at Amazon. It funded a laptop to assist with organizing, as well as hiring a freelance graphic designer to help make pamphlets, among the varied efforts. Later this month, the fund will begin accepting applications for a second round of grants.The group’s sister organization, called Coworker.org, is putting together a detailed report on workplace surveillance measures, including a number of technologies that it says Amazon either developed or pays other companies to use. Along with these efforts, the company is likely to face another high-profile election at its warehouse in Bessemer, Ala. Labor law experts said that in such cases a regional director typically accepts the recommendation of the hearing officer, who argued for setting aside the results.The officer recommended the dismissal of many of the union’s objections to the election, including the contention that Amazon illegally threatened workers with a loss of pay or benefits if they unionized. But she found that a collection box that Amazon pressured the U.S. Postal Service to install near the warehouse entrance gave workers the impression that the company was monitoring who was voting, thereby tainting the outcome.A union brief described how Amazon surrounded the collection box with a tent, on which it printed a company campaign message (“Speak for Yourself”) and the instruction “Mail Your Ballot Here.” The union noted that Amazon’s surveillance cameras could record workers entering and leaving the tent. The company did not respond to a request for comment on Tuesday.If the labor board’s regional office accepts the recommendation to order a new election, Amazon has vowed to appeal to the five-member board in Washington. A recent shift there may affect the outcome: Democrats were assured control of the board in late July, when the Senate confirmed two of President Biden’s nominees.Stuart Appelbaum, the president of the Retail, Wholesale and Department Store Union, which oversaw the union campaign at the Amazon warehouse, acknowledged in an interview after the first election that high turnover at Amazon and the company’s ability to hold mandatory anti-union meetings made winning a vote difficult. But he said that a long-term campaign could be victorious.“I think that we’re going to be able to build on this,” Mr. Appelbaum said. “We pushed the ball downfield. Maybe it’s not the first election. Maybe it’s the second or third election.”Workers have long complained that one of the most fundamental features of an Amazon warehouse is the amount of control the company exerts — over the pace of work, the way workers perform it, the frequency of their breaks, the time they must spend waiting at metal detectors on their way home.In its objection to the election results, the union argued that Amazon had tried to assert a similar level of control over the voting itself, through measures like the collection box. Now the labor board appears on the verge of clawing some of that power back.The board’s role in administering union elections was “usurped” by Amazon’s conduct in obtaining the box, the hearing officer said. That conduct, she said, “justifies a second election.” More

  • in

    Silicon Valley’s Best Pandemic Ever

    As the world reeled, tech titans supplied the tools that made life and work possible. Now the companies are awash in money — and questions about what it means to win amid so much loss.SAN FRANCISCO — In April 2020, with 2,000 Americans dying every day of Covid-19, Jeff Bezos, Amazon’s chief executive and the world’s richest man, announced he was focusing on people rather than profits. Amazon would spend about $4 billion in the next few months “providing for customers and protecting employees,” he said, wiping out the profit the retailer would have made without the virus.It was a typically bold Amazon announcement, a shrewd public relations move to sacrifice financial gain at a moment of misery and fear. Mr. Bezos said this was “the hardest time we’ve ever faced” and suggested the new approach would extend indefinitely. “If you’re a shareowner in Amazon,” he advised, “you may want to take a seat.”At the end of July 2020, Amazon announced quarterly results. Rather than earning zero, as Mr. Bezos had predicted, it notched an operating profit of $5.8 billion — a record for the company.The months since have established new records. Amazon’s margins, which measure the profit on every dollar of sales, are the highest in the history of the company, which is based in Seattle.After stepping aside as chief executive early this month, Mr. Bezos flew to suborbital space for 10 minutes this week. Upon returning, he expressed gratitude to those who had fulfilled this lifelong dream. “I want to thank every Amazon employee and every Amazon customer, ’cause you guys paid for all this,” he said.Mr. Bezos, who was not available for comment for this article, was the only chief executive of a tech company to enter zero gravity in his own spaceship in the past year. But Amazon’s pandemic triumph was echoed all over the world of technology companies.Even as 609,000 Americans have died and the Delta variant surges, as corporate bankruptcies hit a peak for the decade, as restaurants, airlines, gyms, conferences, museums, department stores, hotels, movie theaters and amusement parks shut down and as millions of workers found themselves unemployed, the tech industry flourished.The combined stock market valuation of Apple, Alphabet, Nvidia, Tesla, Microsoft, Amazon and Facebook increased by about 70 percent to more than $10 trillion. That is roughly the size of the entire U.S. stock market in 2002. Apple alone has enough cash in its coffers to give $600 to every person in the United States. And in the next week, the big tech companies are expected to report earnings that will eclipse all previous windfalls.Silicon Valley, still the world headquarters for tech start-ups, has never seen so much loot. More Valley companies went public in 2020 than in 2019, and they raised twice as much money when they did. Forbes calculates there are now 365 billionaires whose fortunes derive from tech, up from 241 before the virus.Silicon Valley made the tools that allowed Americans, and the American economy, to survive the pandemic. People got their jigsaw puzzles, air purifiers and digital thermometers delivered by Amazon instead of picking them up two blocks or two miles away. The consumer economy swerved from local to national.Tech is triumphant in a way that even its most evangelical leaders couldn’t have predicted. No single industry has ever had such power over American life, dominating how we communicate, shop, learn about the world and seek distraction and joy.What will Silicon Valley do with this power? Who if anyone might restrain tech, and how much support will they have? Wealth and the ability to command and control tend to produce hubris more than modesty. As algorithms and artificial intelligence rearrange people into marketing groups, it’s uncertain — to put it politely — how aware the tech industry is of the potential for abuse, especially when it generates profits.With the House Judiciary Committee’s recent vote to advance a series of bills that aim to reduce the power of the most dominant tech companies, and with President Biden appointing regulators who have sharp views of Big Tech, these issues are finally set for a wider debate.It has been a tumultuous 18 months, and even the tech companies are having trouble absorbing what happened.PayPal, the digital payments company, had 325 million active accounts before the pandemic. It reported 392 million in the first quarter. “The winds were blowing in our direction, but we had to set the sails,” said Dan Schulman, the chief executive.The wind was so strong it blew tech into another universe of wealth and influence.The Pandemic’s TailwindIn March 2020, Redfin shut down its 78 offices around the country. Its stock lost two-thirds of its value. Shortly after, demand for real estate started rising again. Jordan Strauss/Associated PressOn March 13, 2020, Glenn Kelman, the chief executive of the online real estate broker Redfin, was biking to work when he got a call from Henry Ellenbogen, a longtime investor in Redfin who had started his own fund.At Harvard, Mr. Ellenbogen majored in the history of technology. One big thing he learned, he has said, was that technology is developed well in advance of people’s ability and willingness to use it.“Tell me something,” Mr. Ellenbogen asked Mr. Kelman, according to an account the chief executive posted on Redfin’s website. “When people start touring homes via an iPhone, won’t a lot of them decide, even after this whole pandemic ends, that this is just a better way to see houses? And if this whole process of buying and selling homes mostly goes virtual, how will other brokerages compete with you?”Mr. Kelman, a little preoccupied by how Seattle’s normally bustling streets were eerily empty, said he didn’t know.“I do,” Mr. Ellenbogen said. “The world is changing in your favor.”This was not a general view then, and it certainly was not what Mr. Kelman was experiencing. The first confirmed coronavirus death in the United States was a nursing home resident in a Seattle suburb on Feb. 29. Within hours, home sellers decided that maybe they did not want strangers breathing in their living room and bedrooms. Buyers began to pull out as well.For Redfin, that was the beginning of a crisis. Within a few days, it shut down its 78 offices around the country. Its stock plunged, losing two-thirds of its value.“The magnitude of the decline was increasing every day,” Mr. Kelman said. He agreed to sell Mr. Ellenbogen more stock for $110 million, thinking Redfin might need cash to make it through a long drought. In early April, Mr. Kelman furloughed 41 percent of the company’s agents, who were salaried employees. More than 1,000 people were affected.By that point, real estate was already turning around. Instead of killing demand for housing, the pandemic fueled it.“The economy split in two on about April 7, 2020,” Mr. Kelman said. “One part of the economy suffered greatly, but another did just fine — the people who said, ‘If the world is going to end in the virus-filled streets of New York, I’m going to Connecticut or Vermont or Maine and I need a house there.’ What we thought was a headwind was a tailwind.”The pandemic as a whole, it became clear, was a tailwind for tech in very basic ways.When tens of millions of people were urged and sometimes ordered to stay put in their homes, naturally companies whose very existence involves facilitating virtual lives benefited. The rise of the teleconferencing company Zoom as both a verb and stock market winner was perhaps the easiest call of the year.“Call it half luck — being in the right place at the right time — and half strategic tactics by companies recognizing this was going to be a once in a lifetime opportunity,” said Dan Ives, a managing director at Wedbush Securities. “What for most industries were hurricane-like headwinds was a pot of gold for tech.”Even companies that might have seemed vulnerable to stay-at-home mandates did well. Airbnb is a company whose whole existence was about going to stay in strangers’ homes. The pandemic should have killed the buzz for its long-awaited public offering in December. But its stock price doubled on the first day of trading, giving the company a value of $100 billion.Tech companies like Redfin that reacted defensively in March risked being left out of the recovery in April. The 2020 housing market, pushed by pandemic demand and negligible interest rates, turned out to be the best since 2006.Those furloughed at Redfin were soon hired back. Mr. Ellenbogen’s deal proved extremely lucrative. But an estimated 10 million people are behind on the rent even as eviction moratoriums start to expire.Mr. Kelman, more introspective than most tech executives, feels a little queasy.“Tech used to be delivering these wonders to the world, and all of us in the industry felt the human uplift of general progress,” he said. “With the pandemic, fortunes have really diverged and at least some people in tech are really uncomfortable about that.”Pushing Back“We went from being pirates to being the Navy,” said Marc Andreessen. “People may love pirates when they’re young and small and scrappy, but nobody likes a Navy that acts like a pirate.”Steve Jennings/Getty ImagesThe biggest, and perhaps the only, threat to tech now is from government.Tech antitrust reformers say the government response to the pandemic, including the national eviction moratorium, repudiated decades of entrenched belief in a hands-off economic approach. Now, the activists say, they will have their moment.“When the government moved in a robust way to keep everybody afloat, free-market ideologies died,” said Stacy Mitchell, co-director of the Institute for Local Self-Reliance, a research and advocacy organization that fights corporate control. “People now appreciate that the government can either make choices that centralize power and wealth or it can structure markets and industries in way that deliver benefits more broadly.”There are signs of pushback against tech that would have been unimaginable a few years ago, beyond the House bills. Ohio sued Google, saying it should be regulated like a public utility. The Teamsters, one of the biggest labor unions, passed a resolution to supply “all resources necessary” to help organize workers at Amazon. Lina Khan, who made her reputation as a critic of Amazon, was appointed Federal Trade Commission chair. On Tuesday, the White House said it would nominate Jonathan Kanter, a tech critic, to be the Justice Department’s top antitrust official.But there are signs of movement in the other direction, too. The F.T.C. and a coalition of state attorneys general saw their antitrust lawsuits against Facebook dismissed by a Washington judge last month. The F.T.C. can refile an improved suit by the end of this month.Any measures restricting tech will ultimately need public sentiment behind them to succeed. Even some of tech’s biggest supporters see the potential for worry here.“We went from being pirates to being the Navy,” Marc Andreessen, a central figure in Silicon Valley for a quarter-century, told the Substack writer Noah Smith in a recent interview. “People may love pirates when they’re young and small and scrappy, but nobody likes a Navy that acts like a pirate. And today’s technology industry can come across a lot like a Navy that acts like a pirate.”Beyond the threat of misuse of tech lurks an even darker possibility: a misplaced confidence in the ability of one loosely regulated sector to run so much of the world.Weeks before the pandemic, the RAND Corporation published a study on systemic risk and how a problem with one company can imperil others in its network. Systemic risk was a big issue in the 2008 financial collapse, when the government propped up some companies because their downfall might imperil the whole system. They were too big to fail.The research group investigated whether tech companies had supplanted financial firms as a key node in the economy, and if the economy was growing too dependent on them. Amazon, whose AWS cloud division has millions of customers, was highlighted.In December, RAND’s point was made when SolarWinds, which makes software that allows other companies to manage their networks, was revealed to have been infiltrated by Russian hackers. Since SolarWinds had so many clients, including Fortune 500 companies and federal agencies, the breach became one of the worst on record.Tech’s dominance means the risks are more concentrated than ever. There were problems at the security firm Cloudflare in July 2020, at Amazon in November, at the cloud provider Fastly last month and at the content distribution network Akamai on Thursday, all of which took down other sites at least briefly.These outages caused little concern.That’s typical of systemic issues, said Jonathan Welburn, a lead author on the RAND study. “Before 2008, when house prices kept rising and rising, no one wanted to hear how they were being artificially propped up and why that could be a problem,” he said.Pushing Forward“When people are remote, I worry about what their career trajectory is going to be,” IBM’s chief executive, Arvind Krishna, recently told the BBC.Brian Ach/Getty ImagesThe pandemic gave tech companies the power and the cash to make aggressive bets on their individual destinies. Buying another company was one way to do this. Global deal values in tech soared 47.3 percent in 2020 from a year ago.Zillow, a digital real estate company in Seattle, spent $500 million in February to buy ShowingTime, a scheduling platform for home showings. A few weeks later, Zillow said it would hire 2,000 people, increasing its work force by 40 percent.But its biggest bet will take longer to play out. Before the pandemic, Zillow discouraged working from home, like most companies. Then last summer, it said 90 percent of its employees could work remotely forever if they chose.At the time, Zillow was in the vanguard of a movement. Now the idea of the non-virtual office is re-exerting its pull with managers.Amazon says its plan “is to return to an office-centric culture as our baseline.” Google asserted the same thing, although it backed off after workers rebelled. IBM says 80 percent of its employees will be in the office at least three days a week.“When people are remote, I worry about what their career trajectory is going to be,” IBM’s chief executive, Arvind Krishna, told the BBC.Zillow is something of an outlier. Even after a year of working from home, 59 percent of its employees told the company they planned to go into the office once a month or less.This may be the pandemic’s ultimate tailwind: not just the future coming much faster to your company, but actively pushing your company faster into the future. It is a risk that might be easier to undertake if your market value has suddenly tripled the way Zillow’s did.If Zillow is wrong about the future and employees are less bound to an office they visit only virtually, the company will stumble. If it is right, it will increase its workers’ loyalty and outdistance earthbound competitors.“The pandemic forced change on all of us,” said Jeremy Wacksman, Zillow’s chief operating officer. “We didn’t wish for it but now we’re learning from it.”More than a third of Zillow employees moved in the year that began in March 2020. Many moves were from one part of Seattle’s metro area to another, indicating a general reluctance not to get so far away from the office you could not drive there. But other employees dispersed to New Mexico, Mississippi and Alabama. Nine moved to Hawaii.“They liked their job but wanted to go somewhere else. That used to be a problem. Now it’s not,” said Viet Shelton, a Zillow spokesman who, as it happens, just moved to Manhattan from Seattle because he always wanted to live in New York.Now that employees no longer have to live where Zillow has an office, interest has swelled. More than 55,000 applied to work at Zillow in the first quarter, up 51 percent from the prepandemic level and about 10 applicants for every person employed there. Zillow has hired more recruiters to deal with the onslaught.Over at Redfin, the stock is up 400 percent from its pandemic bottom. Redfin paid $608 million in February to acquire a publisher of rental listings, its biggest deal ever. But while the company seems so rich, so successful, so lucky from the outside, it feels different within. Managing growth is almost as hard as managing a downturn.“Customers are clamoring for service and we can’t hire fast enough,” said Mr. Kelman. “Redfin never had a moment when it was absolutely and totally killing it, but I always imagined when we did that it would be more fun than this.” More

  • in

    How Times Reporters Investigated Amazon Employment Practices

    A recent Times project that examined how the tech giant manages its workers took months of reporting and hundreds of interviews.Times Insider explains who we are and what we do, and delivers behind-the-scenes insights into how our journalism comes together.Last summer, amid a hiring spree at Amazon so gigantic it left historians struggling for comparisons, Karen Weise, a Times reporter who covers the company from Seattle, brought up a puzzling question to her editors. Approaching the million-worker mark, Amazon was on track to becoming the largest private employer in the United States. Yet, in spite of solid wages and generous benefits, it was quickly cycling through employees. Why?Executives had an “almost palpable fear of running out of workers,” she said later.In August, she got a call from Jodi Kantor, a Times reporter in Brooklyn who was talking to workers from a variety of industries who were struggling with strict rules about time and attendance during the pandemic. She wanted to look more closely at “time off task,” or T.O.T., Amazon’s practice of monitoring workers by the second and disciplining them for too many unexcused pauses.One hot day in a New York City park, Ms. Kantor met with Dayana Santos, an employee who had been repeatedly praised by her bosses but fired for too much T.O.T. during one bad day filled with mishaps she said were beyond her control. Ms. Santos’s story raised fairness questions, and a business one: Why would Amazon, voracious for workers, fire a good employee?Those questions led to a recent Times investigative report on the company that revealed systemic problems in its model for managing workers, such as unbridled turnover, minimal human contact, an error-plagued leave system, delayed benefits and mistaken firings.Ms. Santos had worked at JFK8 on Staten Island, a compelling setting for a potential investigation: the only Amazon fulfillment center in the nation’s largest city, operating under maximum pandemic pressure to deliver to homebound customers. Other media outlets had examined working conditions, injury rates and numerous other aspects of Amazon warehouses. The Times reporters, focusing on JFK8, had a different goal: to understand the connection between the company’s employment model and its astonishing success. They set out to chronicle Amazon’s core relationship with its humongous, growing work force — who got hired and fired, and the rules, systems and assumptions that governed everything in between.But JFK8 was vast — about 5,000 employees in a space the size of 15 football fields — and managers and human resources workers were reluctant to talk. Ms. Weise contacted corporate employees, many of whom never responded. To help tackle the huge project, Grace Ashford, a researcher on the Investigations desk, joined the team. Together she and Ms. Kantor spent many hours on the phone and at the bus stop outside JFK8, including on Prime Day, asking workers about their experiences.Often, Ms. Kantor and Ms. Ashford found that new hires were grateful for the pay but left after a few weeks. “Amazon was a lifeline for them, until it wasn’t,” Ms. Ashford said.Knowing that their requests to interview Amazon’s most senior executives were long shots, the reporters had to find creative ways of understanding the culture inside JFK8. They spoke with human resources staff and corporate leaders, who described Amazon’s glitchy, strained systems and the business challenge of maintaining staff during a public health emergency.Ms. Weise took masked walks with Paul Stroup, a data scientist who had tried to steer Amazon through the crisis but left thinking Amazon could do better by its workers. Ms. Kantor spent the fall shadowing Ann Castillo, who was struggling with Amazon’s treatment of her severely ill husband, a JFK8 veteran.Back office employees at a different location, in Costa Rica, described the partial collapse of the company’s leave systems early in the pandemic, leading to problems like halted benefits for Mr. Castillo.Data obtained through public records showed that Amazon’s overall work force was largely Black and Latino, but internal documents revealed that Black workers at JFK8 were disproportionately fired.After Ms. Santos, the worker fired for T.O.T., applied for unemployment, Amazon contested her benefits. In an obscure New York administrative court, the company filed internal policy memos that provided a rare inside glimpse of the T.O.T. system.After almost 200 interviews, a picture emerged of a company that “seemed far more precise with packages than people,” Ms. Kantor said. Amazon had tried to grow its business quickly by creating a giant semi-automated machine for hiring and managing — but that system often stumbled.Ms. Weise was able to confirm that while the company boasted of job creation, turnover at the warehouses was roughly 150 percent a year — a figure never reported before — meaning Amazon had to replace the equivalent of its entire warehouse work force every eight months.That number, and the entire project, took on deeper meaning when David Niekerk, the architect of Amazon’s warehouse human resources system, told her the turnover was more or less by design. Jeff Bezos, Amazon’s founder and chief executive, had sought to avoid an entrenched work force, fearing laziness and a “march to mediocrity.” So upward mobility and raises for warehouse workers were limited.As Ms. Kantor wrote and Ms. Ashford continued to report, Ms. Weise led a delicate, six-week effort to confirm the voluminous information in the story with Amazon and garner its responses. By then, the company had provided some input, including a tour of JFK8 by the general manager and an interview with Ofori Agboka, head of human resources for the warehouses, who defended Amazon but acknowledged that the company had leaned too heavily on technology and self-service.As part of the fact-checking process, the reporters repeatedly asked Amazon about the T.O.T. policy and Ms. Santos’s firing. Shortly before the article was published, Amazon announced an immediate policy change: No longer could someone be fired for one bad day. Ms. Santos and others were eligible for rehire.The article elicited a strong public reaction, tips from other employees who want to tell their stories and an outpouring of reader comments. (“It was not Bezos who made Amazon. It was all of us who bought from it,” one said.) On July 1, Amazon announced an addition to its leadership principles — critical guidelines for internal decisions and management — that focused on being a better employer.In coming months, the focus is likely to be on whether Amazon will change some of the practices that have propelled it to dominance, either because of internal action or outside force.“They say that broadly, their work force is happy, and their internal surveys say that more than 90 percent would recommend working at Amazon to a friend,” Ms. Weise said.“But 150 percent turnover in a year means that something isn’t working for many people.” More

  • in

    The Teamsters consider a new emphasis on organizing Amazon workers.

    The International Brotherhood of Teamsters, which represents over one million workers in North America in industries including parcel delivery and freight, will vote on whether to make it a priority to organize Amazon workers and help them win a union contract.“Amazon is changing the nature of work in our country and touches many core Teamster industries and employers,” states the resolution, which will be voted on at the Teamsters convention on Thursday. The company “presents an existential threat to the standards we have set in these industries,” it says.The resolution states that the union will “supply all resources necessary” and will eventually create an Amazon division to help organize workers at the company.It does not elaborate on the timing for such a division or how much money or manpower the union will devote to the effort, and a union spokeswoman did not respond to a request for comment on those particulars. Last year the union had revenue of more than $200 million, according to Labor Department filings.Amazon did not immediately reply to a request for comment on Tuesday.In an opinion column this month for Salon, Randy Korgan, a Teamsters official from Southern California who has been the national director for Amazon since the position was created last year, wrote that the union would bypass traditional workplace elections conducted by the National Labor Relations Board.Instead, Mr. Korgan wrote, the union will focus on building support from both Amazon workers and from other warehouse and delivery workers and community members, and it aims to bring the company to the bargaining table by orchestrating strikes, boycotts, protests and other actions.Amazon defeated a conventional campaign organized by a retail workers union at a warehouse in Bessemer, Ala., this year, after which a number of union leaders suggested that a shift to the strategies highlighted by Mr. Korgan might be more fruitful. Those union leaders pointed out that federal labor law gives employers large advantages during election campaigns — allowing companies to hold mandatory anti-union meetings, for example — and that the government cannot fine employers who violate the law. (The retail workers union is challenging the results of the election at the Bessemer warehouse, accusing Amazon of intimidating workers.)Support for the approach is far from unanimous within the labor movement, however.In an interview after the election in Alabama, Stuart Appelbaum, the head of the retail workers union that oversaw the campaign, said seeking to win union elections at Amazon warehouses should remain a focus. “If you want to build real power, you have to do it with a majority of workers,” Mr. Appelbaum said at the time.The Teamsters union holds its convention every five years and uses it to set the priorities that the union will pursue until the next convention. The resolution states that momentum for the Amazon campaign has been building since the union’s last convention in 2016.During that time, it says, various Teamster departments “have been tracking Amazon’s growth, presence and impact on Teamster industries and speaking with thousands of workers to develop different operating theories on the best way to engage and support Amazon workers.” More

  • in

    ‘A Perfect Positive Storm’: Bonkers Dollars for Big Tech

    The dictionary doesn’t have enough superlatives to describe what’s happening to the five biggest technology companies, raising uncomfortable questions for their C.E.O.s.In the Great Recession more than a decade ago, big tech companies hit a rough patch just like everyone else. Now they have become unquestioned winners of the pandemic economy.The combined yearly revenue of Amazon, Apple, Alphabet, Microsoft and Facebook is about $1.2 trillion, according to earnings reported this week, more than 25 percent higher than the figure just as the pandemic started to bite in 2020. In less than a week, those five giants make more in sales than McDonald’s does in a year.The U.S. economy is cranking back from 2020, when it contracted for the first time since the financial crisis. But for the tech giants, the pandemic hit was barely a blip. It’s a fantastic time to be a titan of U.S. technology — as long as you ignore the screaming politicians, the daily headlines about killing free speech or dodging taxes, the gripes from competitors and workers, and the too-many-to-count legal investigations and lawsuits.America’s technology superpowers aren’t making bonkers dollars in spite of the deadly coronavirus and its ripple effects through the global economy. They have grown even stronger because of the pandemic. It’s both logical and slightly nuts.The wildly successful last year also raises uncomfortable questions for tech company bosses, the public and elected officials already peeved about the industry: Is what’s good for Big Tech good for America? Or are the tech superstars winning while the rest of us are losing?Americans have more money in their pockets thanks to government stimulus checks and pandemic savings, and the tech giants are getting a significant share. Their combined revenue is equivalent to roughly 5 percent of the gross domestic product of the United States.Big Tech’s pandemic big bucks have an understandable root cause: We needed its services.People gravitated to Facebook’s apps to stay in touch and entertained, and businesses wanted to pay Facebook and Google, which Alphabet owns, to help them find customers who were stuck at home. People preferred to buy diapers and deck chairs from Amazon rather than risk their health shopping in stores. Companies loaded up on software from Microsoft as their businesses and work forces went virtual. Apple’s laptops and iPads become lifelines for office workers and schoolchildren.Before the pandemic, America’s technology superpowers were already influential in how we communicated, worked, stayed entertained and shopped. Now they are practically unavoidable. Investors have scooped up Big Tech shares in a bet that these companies are nearly invincible.“They were already on the way up and had been for the best part of a decade, and the pandemic was unique,” said Thomas Philippon, a professor of finance at New York University. “For them it was a perfect positive storm.”Times weren’t so good for these companies in the last economic rough patch. In the downturn from 2007 to 2009, Microsoft’s sales dropped slightly, and its stock price fell 60 percent from the fall of 2008 to March 2009, a low point for U.S. stocks. Google and Amazon each lost as much as two-thirds of their market value.One sign of how this time is different: Amazon’s revenue is growing much faster in 2021 than it did in 2009, when the company was one-fifteenth its current size. Sales in the first quarter rose 44 percent from a year earlier, and Amazon’s profits before taxes — which have never been exactly robust — more than doubled to $8.9 billion. Businesses are addicted to Amazon’s cloud computer services, where sales rose 32 percent, and shoppers can’t live without Amazon’s delivery. Investors love Amazon, too. The company’s stock market value has nearly doubled since the beginning of 2020 to $1.8 trillion.For the other tech giants, it’s as if their brief pandemic nosedive never happened. Advertising sales typically rise and fall with the economy. But as other types of ad spending shrank when the U.S. economy contracted last year, ad sales rose for Google and Facebook. The growth was even better for them in the first three months of this year.A year ago, analysts worried that Apple would be crippled as the pandemic gripped China, which is the hub of the company’s manufacturing operations and its most important consumer market. The fears didn’t last long. In the first three months of 2021, Apple’s revenue from selling iPhones increased at the fastest rate since 2012. Sales in mainland China, Taiwan and Hong Kong nearly doubled from a year earlier.Apple’s revenue from iPhone sales in the first three months of the year rose at the fastest pace since 2012.Agence France-Presse — Getty ImagesThe tech giants are not the only companies rallying in dark times. America’s big banks have also been on a tear. So have some younger technology companies, such as Snap and Zoom, the maker of the pandemic-favorite videoconferencing app. The crisis forced all sorts of businesses to go digital fast in ways that could help them thrive. Restaurants invested in online sales and delivery, and doctors went full bore into telemedicine.But the dictionary doesn’t have enough superlatives to describe what’s happening to the five biggest technology companies. It’s all a bit awkward, really. It’s rocket fuel for critics, including some regulators and lawmakers in Europe and the United States, who say the tech giants crowd out newcomers and leave everyone worse off.Big Tech companies say they face stiff competition that leads to better products and lower prices, but their bank statements might suggest otherwise. Facebook’s profit margins are higher now than they were before the pandemic.Some of their success is explained by the peculiarities of the pandemic economy. Some people and sectors are doing awesome, while other families are lining up at food banks and while companies like airlines are begging for cash. Unlike the stock market clobbering in the Great Recession, stock indexes in the United States have reached new highs.The tech superstars have also capitalized on this moment. Alphabet and Facebook have used the pandemic to cut back in places that matter less, such as promotional costs and travel and entertainment budgets. And the tech giants have generally increased spending in areas that extend their advantages.Alphabet is now spending more on big-ticket projects, like building computer complexes, than Exxon Mobil spends to dig oil and gas out of the ground. Amazon’s work force has expanded by more than 470,000 people since the end of 2019. That deepens the moat separating the tech superstars from everyone else.Big Tech is emerging from the pandemic lean, mean and ready for a U.S. economy expected to roar back to life in 2021. Meanwhile, there are still long lines at food banks. Some American workers who lost their jobs last year may never get them back. Housing advocates are worried that millions of people will be evicted from their homes. And being Big Tech is an invitation for everyone to hate you — but you do have towering piles of money. More

  • in

    Why Amazon Workers Sided With the Company Over a Union

    Pay, benefits and an aggressive anti-union campaign by the company helped generate votes at a warehouse in Alabama.When Graham Brooks received his ballot in early February, asking whether he wanted to form a union at the Amazon warehouse in Alabama where he works, he did not hesitate. He marked the NO box, and mailed the ballot in.After almost six years of working as a reporter at nearby newspapers, Mr. Brooks, 29, makes about $1.55 more an hour at Amazon, and is optimistic he can move up.“I personally didn’t see the need for a union,” he said. “If I was being treated differently, I may have voted differently.”Mr. Brooks is one of almost 1,800 employees who handed Amazon a runaway victory in the company’s hardest-fought battle to keep unions out of its warehouses. The result — announced last week, with 738 workers voting to form a union — dealt a crushing blow to labor and Democrats when conditions appeared ripe for them to make advances.For some workers at the warehouse, like Mr. Brooks, the minimum wage of $15 an hour is more than they made in previous jobs and provided a powerful incentive to side with the company. Amazon’s health insurance, which kicks in on the first day of employment, also encouraged loyalty, workers said.Carla Johnson, 44, said she had learned she had brain cancer just a few months after starting work last year at the warehouse, which is in Bessemer, Ala. Amazon’s health care covered her treatment.“I was able to come in Day 1 with benefits, and that could have possibly made the difference in life or death,” Ms. Johnson said at a press event that Amazon organized after the vote.Patricia Rivera, who worked at the Bessemer warehouse from September until January, said many of her co-workers in their 20s or younger had opposed the union because they felt pressured by Amazon’s anti-union campaign and felt that the wages and benefits were solid.“For a younger person, it’s the most money they ever made,” said Ms. Rivera, who would have voted in favor of the union had she stayed. “I give them credit. They start you out and you get insurance right away.”Ms. Rivera left Amazon because she felt she wasn’t adequately compensated for time she had to take off while quarantining after exposure to Covid-19 at work, she said.Amazon, in a statement after the election, said, “We’re not perfect, but we’re proud of our team and what we offer, and will keep working to get better every day.”Carla Johnson, second from left, said Amazon had covered her cancer treatment just a few months after she started at the warehouse. J.C. Thompson, far left, said he had faith in Amazon’s promises.via AmazonOther workers said in interviews that they or their co-workers did not trust unions or had confidence in Amazon’s anti-union message that the workers could change the company from within. Often, in explaining their position, they echoed the arguments that Amazon had made in mandatory meetings, where it stressed its pay, raised doubts about what a union could guarantee and said benefits could be reduced if workers unionized.When a union representative called her about the vote, Ms. Johnson said, he couldn’t answer a pointed question about what the union could promise to deliver.“He hung up on me,” she said. “If you try to sell me something, I need you to be able to sell that product.”Danny Eafford, 59, said he had taken every opportunity to tell co-workers at the warehouse that he strongly opposed the union, arguing that it wouldn’t improve their situation. He said he had told colleagues about how a union let him down when he lost a job years ago at the Postal Service.His job, which involves ordering cardboard, tape and other supplies, did not make him eligible to cast a ballot. But when the company offered “VOTE NO” pins, he gladly put one on his safety vest.“The union’s job is not to keep you — it is to keep everybody,” he said he had told colleagues. “If you are looking for the individual help, it will not be there.”J.C. Thompson, 43, said he believed a commitment by management to improve the workplace over the next 100 days, a promise made during the company’s campaign. He had joined other anti-union workers in pushing Amazon to better train employees and to educate managers on anti-bias techniques.“We’re going to do everything that we can to address those issues,” Mr. Thompson said. He appeared with Ms. Johnson at the Amazon event.Pastor George Matthews of New Life Interfaith Ministries said numerous members of his congregation worked at the warehouse, just a few miles away, and had expressed gratitude for the job. But he was still surprised and disappointed that more did not vote to unionize, even in the traditionally anti-union South, given how hard they described the work.In talking with congregants, Mr. Matthews said, he has come to believe that workers were too scared to push for more and risk what they have.“You don’t want to turn over the proverbial apple cart because those apples are sweet — larger than the apples I had before — so you don’t mess with it,” he said.With its mandatory meetings and constant messaging, Amazon used its advantages to run a more successful campaign than the union, said Alex Colvin, dean of Cornell’s School of Industrial and Labor Relations.“We know campaigns change positions,” he said.Amazon used mandatory meetings and constant messaging to its advantage at the warehouse, said Alex Colvin, dean of Cornell’s School of Industrial and Labor Relations.Lynsey Weatherspoon for The New York TimesStuart Appelbaum, the president of the retail workers union that led the organizing effort, cited several factors to explain the loss beyond Amazon’s anti-union efforts.He pointed to the high rate of turnover among employees, estimating that up to 25 percent of Amazon workers who would have been eligible to vote in early January had left by the end of voting in late March — potentially more than the company’s entire margin of victory. Mr. Appelbaum surmised that people who had left would have been more likely to support the union because they were typically less satisfied with their jobs.Mr. Brooks said that on the previous Friday, he saw eight or 10 new faces in the area where he worked.“I was told they were Day 3 employees,” he said, “and I noticed a few more today.”Many of the workers at the warehouse have complaints about Amazon, wanting shorter hours or less obtrusive monitoring of their production. Mr. Brooks and others said they wished their 10-hour shift had a break period longer than 30 minutes because in the vast warehouse, they can spend almost half their break just walking to and from the lunchroom.Turnout for the vote was low, at only about half of all eligible workers, suggesting that neither Amazon nor the union had overwhelming support.Jeff Bezos, Amazon’s chief executive, said Thursday in his annual letter to investors that the outcome in Bessemer did not bring him “comfort.”“It’s clear to me that we need a better vision for how we create value for employees — a vision for their success,” he wrote.Michael Corkery More

  • in

    Amazon Workers Defeat Union Effort in Alabama

    The company’s decisive victory deals a crushing blow to organized labor, which had hoped the time was ripe to start making inroads.Amazon workers at a giant warehouse in Alabama voted decisively against forming a union on Friday, squashing the most significant organizing drive in the internet giant’s history and dealing a crushing blow to labor and Democrats when conditions appeared ripe for them to make advances.Workers cast 1,798 votes against a union, giving Amazon enough to emphatically defeat the effort. Ballots in favor of a union trailed at 738, fewer than 30 percent of the votes tallied, according to federal officials.The lopsided outcome at the 6,000-person warehouse in Bessemer, Ala., came even as the pandemic’s effect on the economy and the election of a pro-labor president had made the country more aware of the plight of essential workers.Amazon, which has repeatedly quashed labor activism, had appeared vulnerable as it faced increasing scrutiny in Washington and around the world for its market power and influence. President Biden signaled support for the union effort, as did Senator Bernie Sanders, the Vermont independent. The pandemic, which drove millions of people to shop online, also raised questions about Amazon’s ability to keep those employees safe.But in an aggressive campaign, the company argued that its workers had access to rewarding jobs without needing to involve a union. The victory leaves Amazon free to handle employees on its own terms as it has gone on a hiring spree and expanded its work force to more than 1.3 million people.Margaret O’Mara, a professor at the University of Washington who researches the history of technology companies, said Amazon’s message that it offered good jobs with good wages had prevailed over the criticisms by the union and its supporters. The outcome, she said, “reads as a vindication.”She added that while it was just one warehouse, the election had garnered so much attention that it had become a “bellwether.” Amazon’s victory was likely to cause organized labor to think, “Maybe this isn’t worth trying in other places,” Ms. O’Mara said.The Retail, Wholesale and Department Store Union, which led the drive, blamed its defeat on what it said were Amazon’s anti-union tactics before and during the voting, which was conducted from early February through the end of last month. The union said it would challenge the result and ask federal labor officials to investigate Amazon for creating an “atmosphere of confusion, coercion and/or fear of reprisals.”“Our system is broken,” said Stuart Appelbaum, the union’s president. “Amazon took full advantage of that.”Amazon said in a statement, “The union will say that Amazon won this election because we intimidated employees, but that’s not true.” It added, “Amazon didn’t win — our employees made the choice to vote against joining a union.”About half of the 5,876 eligible voters at the warehouse cast ballots in the election. A majority of votes, or 1,521, was needed to win. About 500 ballots were contested, largely by Amazon, the union said. Those ballots were not counted. If a union had been voted through, it would have been the first for Amazon workers in the United States. More