After much criticism, the e-commerce giant Amazon decides to increase the minimum wage of all their workers to $15 an hour. This change will be implemented from November 1st this year.
Amazon will also be increasing salaries of its subsidiary business employees including Whole Foods workers as well as temporary and seasonal employees. According to Amazon, the pay will improve the lives of 350,000 employees.
This includes 250,000 full-time employees and 100,000 seasonal employees.
Bezos announced today,” We listened to our critics, thought hard about what we wanted to do, and decided we want to lead. We’re excited about this change and encourage our competitors and other large employers to join us.”
Amazon made the right call at the right time. The company was facing criticism from every direction.
Whole Foods workers were looking to unionize. The workers feared that they would be replaced by technology and there will be continued layoffs. They wanted lower health insurance deductibles, 401K pension plan, paid maternity leave and increase in minimum wage to $15 an hour.
The workers wrote, “We cannot let Amazon remake the entire North American retail landscape without embracing the full value of its team members. The success of Amazon and [Whole Foods] should not come at the cost of exploiting our dedication and threatening our economic stability.”
But Amazon’s harshest critic was Bernie Sanders. The Vermont senator had just recently introduced legislation titled Stop Bad Employers by Zeroing Out Subsidies (BEZOS).
The bill was aimed to deal with “the great economic crisis in America today.” Sanders wanted to end corporate greed. In order to do this, the Senator suggested a 100 percent tax on companies that have 500 or more employees.
This will be equivalent to federal benefits given to low-wage workers. Senator Sanders was looking at the example of Amazon’s CEO Jeff Bezos in particular. So he was not being subtle at all when he named the bill.
The company clarified that it will not alter the current benefits it is providing. However, the restricted stock unit (RSU) program will be discontinued for customer service workers and for hourly work obligations.
Instead, the RSU program will be replaced with a direct shares purchase policy which will further benefit the employees. Direct shares will remove all the restrictions that RSUs have, so employees will have more freedom when buying Amazon stocks.
The e-commerce giant further said that it will ensure its public policy division will fight to increase federal minimum wage from $7.25. However, the company hasn’t specified an exact amount it wants the minimum wage to get increased to.
Amazon said it thinks $7.25 is an extremely low figure to survive off in today’s economy. It hopes Congress shares the same opinion and increases the minimum wage on a federal level to a much more fair value.
Hopefully, this will encourage other US corporations to lead from the front and increase the minimum wage of their employees as well.