Former Amazonian, the constant use of contractors, even in cases where the jobs are anything but contract, is one of the many things that eventually made me decide to look for something else.
I had the privilege there of working with some insanely dedicated people, smart, hard-working, and good, who were kept on near-permanent contractor status, and then unceremoniously dumped when the legal limits for contract lengths came up.
And these weren't warehouse workers, these were HR folks, recruiters, technicians, and the such - people in positions that are neither seasonal nor temporary.
Beyond the moral/compassion concerns of this, it wreaked havoc with the team to have a good hire on board for most of a year, and suddenly have him/her replaced with someone unknown who needed even more retraining. It also placed a constant load on the people involved, since you're essentially always re-hiring the same position, over and over, with the requisite interviews and costs. Suffice to say it caused a lot of disruption with the team, and I have to question the wisdom of dragging down the productivity of a dozen people to save money on one.
I can't say I know the official (or unofficial) reasoning for this, though of course the usual suspects of paying out benefits comes to mind. Also, certain headcount metrics may exclude contractors, which might be a way for management to look like they're keeping headcount down while still getting the hands they actually need. Either way, it soured my faith in the company some, and with a bunch of other factors led me to depart from the company.
It's a US legal system thing. I don't know the law by name, but a contractor can only be kept on for a period of 6 months to a year. After that, they must be made full-time or removed. After a cool-down period, they can be rehired.
Some companies are getting around this legally but hiring companies to outsource, and yet embed, contractors into the client's office under a managed service agreement.
In Massachusetts you can't hire someone as a contractor that is in effect an employee. It's really tricky to get right. But they're extremely strict about it so employers can't evade payroll taxes, workers' comp., etc.
In Arizona a person is not a contractor unless they can set their own times and their own pace to complete work that is assigned.
That means as a contractor you can't be forced to come into the office at 9:00 AM to work till 5:00 PM, if you are not allowed to set your own work schedule you are not considered a contractor and the company should be paying your taxes and you should be getting a W2 instead of a 1099.
They were fairly strict in that regard as well, my boss was paying me as a 1099 and I wasn't aware of this, and the business got audited by the IRS and he had to retroactively pay taxes and they talked to me and I had to redo my taxes for the two years I worked there. Was a nightmare.
This is federal tax law, and it applies in all 50 states. Contractors also must provide their own equipment (i.e. computer) and be able to make a profit or loss on the engagement. Absent these conditions, you are an employee as far as the IRS is concerned, and your employer is responsible for a great many taxes and sometimes overtime pay.
Where I work we had contractors that were contractors because they didn't fit into company wage scales, i.e. they made too much money. Some of them had been here more than ten years. After that suit all of them were let go or converted to employees at substantially lower wages.
Maybe. The point of hiring top dollar people is the skills that can get you a job are not the same as the skills you need to actually do the job. We would tell them straight out - "Look, we're paying you top dollar, and we expect you to produce." But no matter how careful you are occasionally a lemon slips through the hiring process. If he's a contractor you call up his agent and he's gone the next day. Employees? Not so much.
So when contractors aren't an option management switches gears and says "We're providing all these benefits and growth potential. Hire the best people you can get in this salary range." And what you get, instead of superstars, is plodders.
Wouldn't it also be a tax thing? Here in the Netherlands we have tax laws to prevent this kind of things, where if you can't choose your own hours/days/work and are essentially employed, but pretend to be a contractor, for all tax purposes the company is your employer, even in hindsight. Makes hiring people as contractors pretty tricky for startups sometimes.
We have a saying here used by the IRS and CRA (Canadian-equivalent) for determining if contractors are employees, that if it walks like a duck, and talks like a duck, then it is a duck.
Basically, a contractor (by the nature of its name) is supposed to be hired for a fixed-length period of time. I would guess that's what the tax laws are trying to enforce.
All the government cares about, though, is that they are W2 and not 1099. Then there are no rules. The IRS just wants to make sure that a big entity is responsible for payroll taxes instead of some individual. That way, it's cheaper to collect if there is a problem.
(Where I work, all contractors come in through third-party companies that pay the employees as W2s. They limit being a contractor to 18 months because then people can start suing to get benefits, like an invite to the Christmas party and healthcare. Or so I've been told.)
Right, but it gets trickier than that because even though you give someone a fixed-length period, if you're the only job a contractor does, and you pick the days they work, here you are essentially becoming the employer. Don't know what the US employment taxes are, but it was prohibitively expensive for us as a startup. The total employee costs run about 1.4-1.6x net base salary, even if we would outsource through a temp/payrolling agency.
"I don't know the law by name, but a contractor can only be kept on for a period of 6 months to a year. After that, they must be made full-time or removed. After a cool-down period, they can be rehired."
Is that true? I know of contractors from other countries who have worked in the U.S. for the same company for more than five years. And these companies are Fortune 500 so I assume they have a pretty rigid legal team.
It isn't true. There's no limit on the length of time a legitimate contractor can be engaged, but if you are a business walking up to the line of the law defining employees or contractors, one way to limit your risk is to engage the contractors for a limited duration.
An independent contractor can only work 6 to 12 months before being let go? Absolutely true. I saw it with my own eyes.
An independent contractor returning after a few months of break? Absolutely true. I also saw this.
But a US law? You're right, it may not be a real law. However, when the legal department comes down and says that contractors cannot stay longer than X months because of a previous lawsuit at a company, I'm going to rightly assume that they don't want to break a law. And the way you said "if you are a business walking up to the line of the law", I'd guess that you agree that there is some sort of law that may be broken if companies aren't careful.
I was merely pointing out the real problems that companies face by employing contractors, instead of giving a blanket "Untruth!" statement.
Another advantage to keeping a significant part of your work force transitional, is that knowledge has to reside in the documentation and processes, as you can't plan on the same employee being present for more than a year. Management likes this, because it gives them more leverage in replacing employees.
Another flaw in this assumed "advantage": It assumes that said documentation is actually created and maintained, and apparently assumes that doing so is free, or nearly so.
This is the growing dichotomy and split of american class. You have the educated who run the business side and programming side of amazon and from what I hear like their jobs and get paid well. Then you have the labor force. They don't have the education (different class and have a harder time affording the expensive american education or affected by the growing american anti intellectualism) and so they are left with hard labor jobs, which are drying up. Part of the reason they are drying up is that the rest of the world has a vastly lower standard of living (and some would arguer better work ethic too) and so the job can be out sourced to those who will do the same work for less. And now technology is replacing some of the remaining jobs. Seen the automated checkouts stores now? DVD rental placing like blockbuster are being replaced by websites (netflix) and big red boxes in other stores. And automated assembly in factories. These jobs are never coming back.
This leaves the uneducated class of america fighting for the few remaining low paying labor jobs left in the country like these ones that have to stay for locational reasons (the one location on the highway that is with in 1 days drive from 1/3 of the american and canadian population) and haven't yet been automated with technology.
The impulse of many of us is yes to just say "well then get educated" but it isn't that easy. There are big social forces in america about entitlement and anti intellectualism and education in america is also often just bloody expensive.
It's a mess and a further symptom of the growing class divide that now their own lower class people are being worked like we saw nike sweat shops working Asians not too long ago.
I think people really over estimate the anti-intellectualism side of things.
When you come from hard labor you don't have much time to really think about your options. You're 18, you're on your own, you need to feed yourself and pay the rent. You don't have many options. Your family was never in a position to afford college for you, living paycheck to paycheck and all. Theres a vein of fatalism running underneath all of this, your daddy worked in a warehouse, his daddy worked in a warehouse, and you're gonna work in a warehouse too. It is just how it is. It is sad, but it is how it is.
I worked in Amazon warehouses for two summers during college, doing the sorts of tasks described here. The first year there was no A/C. Actually, it wasn't so terrible. The next year there was central air, but by then there was quite a bit more structure. I was on a 10h overnight shift four days a week. There were traffic lights hanging from the ceilings; if the light was green, you'd go home at 6am. If the light was yellow, you could opt to work overtime for an hour. Red light = mandatory overtime.
It was fairly unpleasant, but I was only there 4 months at a time, and for a 19 y/o the pay was better than other things.
There were indeed pretty stringent rules about keeping up a rate of work. I felt lucky that lifting books at standing height and walking constantly didn't cause the fatigue that using a tape gun for 10 hours might. I don't recall getting demerits but I remember the system (this was 10+ years ago).
When I first scanned the report I thought it seemed overblown. However, the workers interviewed describe a lack of human connection in the face of difficulties. When I did this work, there were expectations, but there were also plenty of pleasant, supportive managers around. I never had any problems doing my work, but I would have imagined more interest and understanding of a team leader if someone did.
This was long, long ago in the history of Amazon. Given their volume today, I can't say I'm surprised at the numbers-focused attitude. It's very disappointing to hear.
When I was 14 I worked a warehouse gig assembling sunday-morning newspapers (the news printed that morning is combined with a larger pre-printed section of want-ads, etc). The hours were 3am-6am, it was poorly ventilated, the pay was bad, and the work tiring. The lesson I took away from that job is that if I wanted something better I had better improve myself and get some marketable skills. Skills that'd add value to what I do for an employer, and that'd cause the employer a loss of value if they were to let me go.
I'd hope current warehouse workers would walk away with a similar lesson - but apparently not in this case since the employee at the opening of the article is 34.
Basically, if you are an unskilled worker don't show surprise at the fact that your employer can and will easily replace you with someone else who'll do more work at a cheaper price.
If not, I'll provide different advice that I learned in the Army. Drink more water if it is hot.
Not everyone will have the chances or make the right choices to "better themselves". That doesn't mean they deserve to work in unsafe or unhealthy conditions.
that's the problem of the american entitlement. There are still huge chunks of the rest of the world who would jump for those jobs at those wages. This is why most of these jobs that haven't been automated have been outsourced. This one remains for locational reasons.
Sure it'd be great if they didn't deserve that, but it's not just americans making $11 or $12 an hour. It's huge chunks of the world living off less than $1 a day
Not sure why anyone can justify anyone being forced to work in unsafe or unhealthy conditions for low pay. Regardless of what country they're in.
People making $1/day shouldn't be faced with it & the people making $12/hr shouldn't be faced with. Also let's not pretend that cost of living is comparable between all countries.
Now this isn't to say that people aren't faced with these conditions, but just because that's the way it is, doesn't mean that's the way it should be.
It can be justified because our entire economy would collapse otherwise. If most of the people in the US want to continue to purchase goods at relatively low prices then this is what is necessary. Go ask the average person why they do not shop at Whole Foods. Now imagine what would happen if every company paid their employees as well as Whole Foods does for unskilled labor and put as much effort as Whole Foods does into sourcing products that are better for those producing them (http://www.wholefoodsmarket.com/products/whole-trade.php). What happens to those on the lower end of the earning scale in that situation?
true, I may have been a bit harsh. More what I was going for I guess is that there are several larger problems than just some american amazon warehouse workers. Both larger problems in america of which this is just a symptom and larger problems in the world where this is rendered unnoteworthy.
We need to attack those problems, not do something too focused like harangue on Amazon specifically.
That sounds a lot like most warehouse jobs. I had a warehouse job while in college for a while and it was either really hot or cold. Sometimes it was busy, sometimes it wasn't. One thing remained constant - pretty much everyone complained about their job and how much they hated working there, yet nobody ever seemed to leave.
Sad, but true. My employer has a shop floor where the heat was, in fact, brutal. I personally raised a fuss about the heat, being one of the people deputized as first aid providers and having seen a few things that worried me. Thankfully, management responded and the guys got some more swamp coolers, as well as these things you soak in cool water and put around your neck, which improved things.
So yes, especially this year with all those heat warnings, miserably hot 100+ degree work floors, mandatory overtime and constant use of temps, harsh conditions are, unfortunately, quite normal for that kind of environment.
That said, just because it's normal, that doesn't mean that it shouldn't be improved. If you have to make a fuss, you should. There are a ton of people out there who simply can't afford to make waves in this economy and they're suffering for it. The people who can best afford to make waves need to if they see unsafe conditions.
Those water absorbing polymer beads/bands around the neck are life-saver. They cool down the body temperature slowly overtime. Last time I hiked in Grand Canyon during summer, it was 110 degree. Those water beads really help to cool down.
I badgered one guy into wearing one. I noticed a big improvement in his condition, whether he did or not.
You're right that they help a LOT. I think we were able to get a bunch at a dollar store for some ridiculously cheap price. I can't believe that more places don't use them.
I've worked at warehouses over summers in high schools and it was tough but I don't regret it. This place sounds like a third world shithole.
Everything else aside, the "terrible" working conditions at Foxconn that people get so riled up about sound better then this Amazon warehouse in the US.
People jumped off the factory building and committed suicide at Foxconn. And the sensitive folks at Foxconn, with the blessing of Steve "Foxconn is not a sweatshop" Jobs, put up nets to prevent them from jumping instead of improving working conditions. I believe that the Amazon warehouse is much better than this.
That's what I was thinking. This whole article boils down to the fact that there are people working in a building without A/C, there were a few hot days, and some of them aren't very heat tolerant. And $11/hr is pretty good pay for this kind of work. When I worked in logistics our customers were paying their employees minimum wage.
There are a lot of jobs where people work in these kinds of conditions. Where I live when it gets hot and the air is still it's pretty common to see people who work outside overcome by the heat to some degree.
Yeah, worked a summer at a supermarket warehouse. They were nice enough there to sprinkle water on the roof, bringing the temperature inside down, in addition to having coolers. Middle of summer was still very hot, worst was the smell of tins of cat food that were spoiling. The only plus points for that job was the Windows CE powered, voice activated, order picking computers and driving electric carts around...
One of the people in the article says he's worked in other warehouse jobs before, and was never treated like a piece of crap (his words) until he worked at the Amazon warehouse. So there is a claim that this warehouse in particular is worse than others.
Granted I can only give you a sample size of one, but during the downturn, things got pretty bad in a number of ways, mostly in that staffing was severely restricted and pressure was put on production to produce a lot with only a few people. That also leads to having to work at an unsustainable pace.
High turnover and having lots of temps to try and make things work, even semi-permanent temps, is generally the norm as far as I can tell. And yes, it can really screw with production. Lots of people who don't know what they're doing is always hard to deal with.
So yeah, I think it was the downturn that led to people getting treated like crap, but maybe Amazon really is worse than most. I've never been there, so I don't know. I can tell you that when you have lots of temps, you will see people getting fired all the time for screwing up or slacking off. Some of them even deserve it.
Some of the comments here are along the lines of "Well, they should go get a better job!"
Hint, folks: not everyone can get a professional job paying six figures a year. And even if they could, the moment they did, your own wages would drop substantially.
Having sympathy isn't going to fix things, though.
How can we get people in this country to be capable of doing jobs that people willing to work for next to nothing in other countries can't do just as capably? If we can retrain a bunch of them to be great software engineers, our own wages might drop a bit from their absurdly high peaks, but currently the demand for people able to write good software is underserved, and it could be much larger, as software enters other facets of life and needs to be maintained and rewritten to deal with changing demands.
Having more engineers would enable a greater range of software to be created.
Establishing sympathy is a good first step, otherwise you end up discussing with people whether there's anything to be concerned about =)
The thing is, we'll always need warehouse workers in one form or another. One form draws from the relatively less formally educated and puts them to work; if we go that route, it's morally imperative that we do our best to make sure they work in a workplace with dignity and a voice. Education of any particular worker won't help that, as s/he'll just be replaced by another.
The other form, of course, is to move from human to machine labor. In the long term this is the best route. (The question is then, though, what of the people who are deskilled and unemployable?)
I'm pretty sure machine labor is the inevitable endgame for warehouse labor, and I think it's likely coming sooner than most other manual labor that's reasonable to automate, since it's a controlled, structured environment and there's no need to interface with humans.
For the unemployable, I think we'll need a combination of super-cheap scalable teaching methods and a more socialist system. Hopefully we'll be able to transition relatively smoothly, if that's the case.
You sure about that? I've seen a lot of supermarkets going self-checkout lately. Sure, it's not out-sourcing in the usual sense; but it is replacing workers with something cheaper (equipment which was probably manufactured in another country).
Someone has to update our nation's crumbling infrastructure.
True, but the number of workers you need depends on the construction techniques you use. If manpower is expensive, you buy prefabricated components and only do the final assembly on site.
Someone has to change the IV bags and push around the stretchers.
True, but technology and a willingness to spend more on equipment can reduce the number of people you need to do this. (e.g., "smart" IV bags which alert staff when they need to be changed, rather than having nurses walk around checking the bags.)
Someone has to teach future generations about math and science and history and puberty.
Khan Academy.
Electricians and plumbers, they're definitely going to be in demand.
True, but the more expensive they are, the greater the pressure will be to create hot water heaters which don't need to be replaced every five years.
Reports of the death of the American blue collar job are greatly exaggerated.
There are a lot of job categories which will never be eliminated entirely, sure -- but most of them can still be dramatically downsized via the application of technology and sufficient quantities of money.
Nobody is so essential to the continuation of civilization that they can set their own wages. There's always going to be a point where people will say "you know, we've got a cheaper option".
"If manpower is expensive, you buy prefabricated components and only do the final assembly on site."
Not infrastructure, but that's exactly what Boeing has done for years, assemble airplanes out of prefabbed subassemblies.
When Boeing gets a contract to sell planes to, say, China or Japan, part of the deal is often that the subassemblies (wings, body sections, whatever) are made in that country, shipped to the US and assembled by Boeing.
Airplanes are a more controlled and regular construction environment than highways, but I don't see why it won't become more common. Residential and commercial buildings too, I suppose. Suburban houses are already cookie cutter these days.
2. Construction - There is a glut of unskilled construction labor right now, though, coming off the housing boom. Could conceivably be automated, but it's probably a lot farther off.
3. Healthcare - Hard to automate, but the things you mention seem less so than construction.
4. Teaching - Scalable teaching methods - the few best professors can teach a vast number of students relative to what used to be possible. Khan Academy and Stanford's upcoming online classes seem like early stabs at what I think will eventually become the norm.
5. Maintenance work - you're probably right, this is very case-by-case, and requires a lot of training to be able to deal with all contingencies.
Overall, I don't think the future of American blue collar labor's supply vs. demand is very bright at all, unless there's a big uptick in demand for hard-to-automate fields.
EDIT: And when I say automation, I usually mean single-purpose robots or devices that handle the busywork parts of things, like self-checkout machines. cperciva covers this pretty well in his healthcare section. General AI is obviously very hard, and good construction bots would probably need something like that if they were to be able to deal with problems and exceptions on their own.
My father is a truck driver, and he refuses to work with Amazon for many of the reasons listed in this article. Amazon also refuses to pay detention time for drivers that have been at their facility for more than two hours (an industry standard).
It sounds like we really should change the system to where automatisation of those jobs is a good thing.
The situation is simply ridiculous - we can feed everyone, there is way enough stuff for everyone (at least in the richer countries, and longterm, everywhere, I'd wager) and it's possible to automate great parts of hard and gruesome work. And yet, the system demands that everyone works and gets stressed out, even if there is not enough to do - it's not just economic restraints, it's also the value people are given in society.
I'm not arguing against social capitalism here, which seems to work better in large scales than anything else we've tried, but this really is a problem and an opportunity that needs to be discussed more.
As a fan and customer of Amazon, I am sad and disgusted after reading this article. I will have to serious reconsider my Amazon Prime membership, which expires in a couple of weeks.
The description of the working conditions, job availability in the region, and worker treatment reminds me of the initial few chapters of Manna (http://en.wikipedia.org/wiki/Manna_%28novel%29). In the novel, employees are instantly replaceable cogs in a machine and are treated with complete disrespect. As there are more people than there are available jobs, any slacking at all results in employee termination. I guess the story wasn't such a fiction, after all.
I worked as a developer there, conditions weren't much better. Frugality means cheap, and the turnover rate was just insane. A lot of the ones who stay are only staying because the stock price is so high right now making their options worth a lot. Really depressing, because upper management at Amazon is very very competent - they have a long term vision, and they are executing on it with a ton of energy. They just seem to have forgotten about the peasants along the way.
What's odd is that Newegg always ships me broken stuff, whereas the stuff I get from Amazon is always packaged properly to avoid damage. (Note to Newegg. Don't send me a hard drive in a plastic eggshell case with a few packing peanuts in the box. I'm surprised those drives lasted long enough to even get an OS installed.)
I used to work at Amazon in the operations department. The amount of work they do to ensure things are undamaged in transit is pretty amazing, and mind-boggling.
What people see is a brown cardboard box with air pillows, but there is a really absurd amount of technology and science behind it.
I've love to see Jeff B. work at one of these warehouses 'undercover boss'-style. Amazon is in the business of keeping prices low but the conditions described in that article sound awful.
"This is an amazing device! What do you call this thing? A "push cart"?? I call it the Future of Transportation! This push cart will transform cities!!!"
It is ridiculous that Amazon is allowed to have paramedics parked outside and ship people to hospitals for completely foreseeable events.
If they had to pay for these externalities you bet they would paint their roofs white.
That's nearly very plant, factory, and warehouse in the world. There's nothing unique about these conditions. When I was younger and worked in my family's plant I'd get to work before 5am to beat the heat. Sometimes I couldn't and the heat was brutal, but you learn to deal with it (set up fans, take more water breaks, change your clothes).
Many warehouses don't let you set your own hours. I doubt Amazon does.
> take more water breaks
These employees were afraid to take medical breaks. I doubt they have the freedom to take extra water breaks without being in jeopardy of losing their job.
I had the privilege there of working with some insanely dedicated people, smart, hard-working, and good, who were kept on near-permanent contractor status, and then unceremoniously dumped when the legal limits for contract lengths came up.
And these weren't warehouse workers, these were HR folks, recruiters, technicians, and the such - people in positions that are neither seasonal nor temporary.
Beyond the moral/compassion concerns of this, it wreaked havoc with the team to have a good hire on board for most of a year, and suddenly have him/her replaced with someone unknown who needed even more retraining. It also placed a constant load on the people involved, since you're essentially always re-hiring the same position, over and over, with the requisite interviews and costs. Suffice to say it caused a lot of disruption with the team, and I have to question the wisdom of dragging down the productivity of a dozen people to save money on one.
I can't say I know the official (or unofficial) reasoning for this, though of course the usual suspects of paying out benefits comes to mind. Also, certain headcount metrics may exclude contractors, which might be a way for management to look like they're keeping headcount down while still getting the hands they actually need. Either way, it soured my faith in the company some, and with a bunch of other factors led me to depart from the company.