UK

Amazon Faces Moral Questions, Government's Jobs Tsar Matthew Taylor Says

Top economist questions ethics of bus 'benefit' costs.

26/09/2017 18:00 BST | Updated 26/09/2017 18:31 BST
Education Images via Getty Images
Amazon should 'think very hard' about how it treats its staff, the government's jobs zsar has said

Amazon should “think very hard” about how it treats its staff, employment tsar Matthew Taylor has said, after it was revealed some workers are losing out after effectively being forced to pay third-parties for the “benefit” of special buses.

Taylor, who led Tony Blair’s policy unit in Downing Street and chaired a recent review into modern work for Theresa May, said Amazon should consider “whether it is fair” that workers paid a few pence above the minimum wage are left with no option but to use expensive transport to get to work.

RSA
Matthew Taylor said Amazon has moral questions to answer over staff bus 'benefit' costs at its site in Rugeley

HuffPost UK revealed last week that some workers at a “flagship” Amazon warehouse in rural Rugeley, Staffs, were taking home less than the minimum wage after paying £8 a day on a special bus service from Birmingham city centre, 20 miles away.

Taylor, who is also chief executive of the Royal Society for the Arts, said that while the American giant’s position that transport costs are the concern of workers is technically correct, there may still be moral and ethical questions over the situation.

“I think the company needs to think very hard about how it is treating its employees,” Taylor said.

MATT DUNHAM via Getty Images
Taylor released his review into modern work alongside Theresa May in July 

He added: “Morally and ethically, if a company sets up the workplace somewhere which is unlikely that people will be able to reach that workplace without spending quite a lot of money and those people are on [close to] minimum wage, I think the company needs to think very hard about how it is treating its employees.

“If it is unlikely that, that Amazon facility can be fully staffed without people undertaking very lengthy and expensive journeys then I think ethically they should think hard about whether or not it is fair for people on [close to] minimum wage to bear that cost given that where they set up their site seems to depend on people undertaking that kind of journey.”

HuffPost found the special bus services are, for example, the only way workers without their own transportation can get to the site in time for early morning shifts at the weekend.

I think the company needs to think very hard about how it is treating its employees Matthew Taylor, chair of modern work review and RSA chief executive

Staff at Amazon in Rugeley later told HuffPost UK of arduous journeys and the toll of expensive travel costs after the situation was uncovered during a public sightseeing tour.

“I get up at 4.45am and don’t get home until gone 8pm,” one worker who asked to remain anonymous said.

Local councillors claimed dire transport links have led to reports of workers sleeping under canal bridges.

After HuffPost’s report, an employment agency who were describing the buses as a “benefit” of employment agreed to change its job adverts, while Amazon unveiled plans to launch its own services at half the current price.

Bloomberg via Getty Images
The Amazon warehouse in Rugeley is located away from regular public transport links

Many workers at Amazon earn £7.65 an hour. After paying for transport, however, some staff at Rugeley take home £6.80 an hour for a standard nine and half hour shift. That’s below the minimum wage of £7.50 for the over 25s and £7.05 for the over 21s.

Taylor added: “The idea that someone has to get up very early, go on a bus work hard in a warehouse on a temporary contract then wend their weary way home at the end of the day and not get a great deal in their pay packet... we would all like to be in a world where there is as few people as possible working in such circumstances”.

Amazon says more than 10,000 warehouse staff in the UK began as temporary workers and progressed to more lucrative permanent roles.

“We make a concerted effort to place as many people who join us on a temporary basis as possible into permanent roles with competitive pay and comprehensive benefits,” the firm said.

At Rugeley, the site has over 1,600 permanent staff, with thousands more temporary workers at peak times of year.

Taylor said the firm’s mix of temporary and permanent staff shows there is a clear route of progression for staff.

Bloomberg via Getty Images
While most staff at Amazon warehouses begin as temporary workers, many do progress to more lucrative permanent roles

“I think [transferring from temporary roles to permanent] is the first step [to progression] but I hope that it won’t necessarily be the last step,” Taylor said.

“I think it’s important for all employers to provide realistic routes for staff to be able to progress.

“I don’t think there’s anything wrong with the idea that you take people on on a temporary basis and if they perform well you give them a permanent job.

“That’s better than people being on temporary contracts indefinitely.”

And Taylor urged all firms to have more transparency over criteria for progression.

Bloomberg via Getty Images
The vast Amazon warehouse at Rugeley is home to up to 5,000 staff, depending on the time of year

“I think that it is important that the rules about progression are fair and that what people are being judged on is genuinely their performance, they are not being judged on unreasonable expectations,” he said.

“It’s not reasonable to expect someone who is working temporarily on minimum wage to be a super high performer because you aren’t paying them very much and you’re not guaranteeing them very much.”

Taylor said a “tight” labour market, with record high levels of employment, was leading to a levelling off of controversial employment deals like zero-hours contracts.

“At the moment incomes are rising fastest amongst our lowest earners,” he added.

Bloomberg via Getty Images
Most staff at Amazon's warehouses start on £7.65 per hour

But challenges posed to employment after Britain leaves the European Union loom, Taylor said, with the prospect of both rising earnings and increased automation occurring in tandem.

“Let’s assume that the labour market stays tight, then let’s assume that in one way or another, that it becomes harder for people from eastern Europe to work in Britain, I suspect that there will be two consequences of that,” Taylor said.

“The good consequences for workers will be that in such circumstances, employers might have to pay more, and they might have to offer permanent contracts rather than temporary contracts.

“On the other hand, I’m already hearing from the agricultural sector that farmers who have previously chosen not to invest in automating some of their processes are now investing in automation because they are finding it increasingly hard to get the casual workforce they had relied on for planting and picking.”

Alamy
Amazon's vast warehouse, low-lying blue building, centre, dominates the town of Rugeley, Staffs

An Amazon spokesperson told HuffPost: “Amazon provides a safe and positive workplace with competitive pay and benefits from day one. We are proud to have been able to create thousands of new permanent roles in our UK fulfilment centres in recent years.

“One of the reasons we’ve been able to attract so many people to join us is that we offer great jobs and a positive work environment with opportunities for growth. We perform an annual wages analysis to ensure we are offering competitive wages and great benefits to our people. 

“All permanent and temporary Amazon workers start on £7.65 an hour or above, regardless of age and £11 an hour and above for overtime, with 30 minutes of paid breaks and subsidised meals.

“Base pay increases over time and permanent employees also receive a comprehensive benefits package, including private medical insurance, a company pension plan, life assurance, income protection, subsidised meals and an employee discount.

“All permanent people also receive stock grants, which over the last five years equates to £1,000 or more per year per associate.

“Most people in the UK have to travel to their place of work and pay their own transport costs. People who work at Amazon choose how to travel to work, whether by car, bicycle or public transport[.]

″[D]uring the seasonal period, Amazon is supporting those who travel longer distances to work in its fulfilment centres by helping with car share arrangements as well as providing subsidised coach travel if that is the best option for them with daily return fares of £4.”

Amazon has previously described Rugeley as one of its “flagship” sites.