Amazon workers split over pay hike, loss of bonuses

MURFREESBORO, Tenn. — Almost no workers clapped last week at the allhands meeting after lunch at this Amazon fulfillment center outside Nashville when a plant manager announced that the company’s minimum wage was climbing to $15 an hour.

Instead of celebrating, many workers put their hands up to ask questions and express deep frustration, according to five employees at the facility. They asked why people who had been toiling in the company’s warehouse for years would now be paid similarly to new employees and temporary holiday help, according to the workers.

“People seemed really bummed out because now (seasonal) workers are making $15 an hour,” said Chip Litchfield, who is thrilled that his pay will jump from $11.50 an hour in a program called Amazon Camper Force, which brings people who live in RVs to work in certain fulfillment centers during the holiday season. “We’re just a bunch of old people who they bring in a few months a year.”

Amazon’s decision to raise its minimum wage received widespread praise as a victory for workers and a model for other big U.S. corporations, even drawing plaudits from people as varied as Sen. Bernie Sanders, I-Vt., who had previously railed against the company’s treatment of workers, and Larry Kudlow, President Donald Trump’s top economic adviser.

But within 24 hours, questions started to surface about how generous the move really is. Amazon also announced that it would cut bonuses and stock grants, and some veteran employees say they are being devalued and fear they might end up with less money than they get now.

It’s impossible to know how magnanimous Amazon’s action is — the company said it would incur an expense but did not say how big it would be. But the divided reaction among some of the 250,000 full-time employees and 100,000 seasonal staffers underscores one of the biggest tensions of Amazon’s massive growth. It’s likely that no company has hired more people in recent years than Amazon, which has opened fulfillment centers with breathtaking speed.

Yet even as it seeks to maintain a satisfied workforce and fend off critics who say the company doesn’t treat employees well, Amazon must minimize costs and maximize the efficiency of its warehouses so it can continue to grow its formidable position in online commerce, delivering products in as little as an hour.

“Raising their minimum wage to $15 was the easy first step,” said Paul Sonn, state policy director of the National Employment Law Project. “Amazon is torn: They don’t want to be known as a bad employer, but they are an aggressive cost cutter.”

Amazon’s pay is significantly above the $10.28 an hour that the typical retail worker makes, but it’s less than the $15.53 that a median warehouse employee is paid.