Guess What Amazon’s New One Hour Delivery REALLY Costs

In the bay area this past week, corporate giant Amazon launched “Prime Now,” a shipping program in which customers get their product one hour after purchase. But ethical and legal questions arose when thinkprogress found out the burden it places on amazon’s workers.

Law suits have begun to be filed, after it was found that during a 120 mile day, Amazon’s “Prime Now” drivers in the Los Angeles market make about $88 but spend $69 for gas, insurance, and auto maintenance leaving them with a mere $19, well below the California minimum wage.

The suit claims that Amazon is:

“failing to pay overtime, failing to provide breaks, and a host of other violations around its instant delivery service, which allows shoppers to request one- to two-hour delivery of thousands of items across its inventory.”

It has also placed such a burden on the drivers that they should be classified as Amazon employees rather than independent contractors. The “Prime Now” movement is being funded by the Amazon drivers and not the company.

Since Amazon classifies these workers as “independent contractors,” they can maximize profit at the expense of their workers by not having to pay mileage reimbursement, gas, insurance, auto maintenance and other expenses. It has been found that per year it is $4,000 cheaper to have an independent contractor on your payroll than an employee.

Amazon continues to exercise extreme control of their contractors by requiring them to wear an amazon uniform, work a set schedule, and make any assigned deliveries.

The good thing for the drivers is that this isn’t the first time a company has been accused of this type of misconduct. FedEx was sued and had to pay out $228 million to California drivers when they labeled some of their employees as independent contractors to avoid paying people what they are worth.

Both Amazon and FedEx are prime examples of trying to have it both ways by wielding a huge delivery service as with a traditional employer-employee relationship but labeling it as contracting. As the profits go higher, the very people that made the service possible are the ones paying for it.


Featured Image by Massachusetts Cop Block via Flickr, available under a Creative Commons license.

Tanner Bisbee hails from the great State of Maine. He's a full time college student and serves on the football staff at school. His most notable work to date is his book Modern Day Sports Blog. To read more check out my blog