New Jersey AG sues Amazon over driver pay, conditions

Amazon leverages its power over delivery companies to prevent workers from unionizing and limit their pay, state officials claim.(CN) — Thanks to monopolistic practices by Amazon, delivery drivers earn lower wages and endure “harsher working conditions than they should,” the New Jersey attorney general says in a federal lawsuit filed Tuesday against the e-commerce giant.Amazon “unlawfully maintains its dominant power” over the companies it contracts to deliver packages, including preventing unionization, preventing companies in its delivery network from hiring each other’s drivers and anticompetitive practices, according to New Jersey Attorney General Jennifer Davenport.Davenport says Amazon is a monopsonist, or a “dominant buyer of specific goods or services that can control or dictate the terms of payment for the services it demands,” exerting undue influence in its delivery service partner program, launched in 2018.Delivery service partners contracted by Amazon are beholden to Amazon’s demands, Davenport says in the 52-page lawsuit filed in the District of New Jersey. They rely on Amazon’s infrastructure, package processing and delivery routes, and Amazon tries to keep the contractors small to limit their bargaining power, according to the suit.In March, for instance, a delivery business in Edison, New Jersey, warned drivers that Amazon would cut the company’s contract if drivers attempted to unionize — a move that “would likely destroy” the business. The threat followed Amazon’s termination of a contract in Queens in response to unionizing efforts, resulting in 150 drivers losing their jobs.Amazon also targets drivers with limited comparable job opportunities, Davenport claims in a portion of the complaint that is partially redacted and doesn’t publicly elaborate on what that means. And in the form of no-poach agreement, the tech giant prevents delivery companies from competing for drivers, in what the Garden State’s AG calls a scheme to keep the delivery businesses small.Otherwise, companies that grow in size and importance “could potentially negotiate more competitive compensation and terms from Amazon for the services Amazon demands.”“Amazon built a company worth trillions while subjecting drivers in its delivery network to artificially low pay and punishing working conditions thanks to its overwhelming power in the labor market,” Davenport said in a statement announcing the lawsuit.Amazon did not immediately return a request for comment.New Jersey’s attorney general is also part of a separate lawsuit against Amazon, in which more than a dozen states and the Federal Trade Commission accuse the company of using a sophisticated price-manipulation algorithm to stifle competition.In a third suit, New Jersey officials accuses Amazon of mistreating pregnant workers and those with disabilities, and in yet another, the state AG says Amazon misclassifies drivers as independent contractors to deprive them of proper wages, benefits and legal protections.Subscribe to our free newslettersOur weekly newsletter Closing Arguments offers the latest about ongoing trials, major litigation and rulings in courthouses around the U.S. and the world, while the monthly Under the Lights dishes the legal dirt from Hollywood, sports, Big Tech and the arts.Additional Reads