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Short shrift for unions in Amazon's silicon jungle

Independent, The (London),  Feb 3, 2001  by Andrew Gumbel in Los Angeles

WORKERS LAID off this week by the online retailing giant Amazon.com believe they were not just victims of economic hard times but targets of a concerted effort by the company to crush a burgeoning unionisation drive, the first of its kind in the internet economy.

Union organisers have appealed to the federal government for an immediate investigation into the lay-offs, saying the largest group of the hundreds facing the sack were in a Seattle customer service centre where union activity has been most intense,

The organisers have accused the company of violating union laws. Backed by a group called the Washington Alliance of Technological Workers, they say Amazon managers subjected them to intimidation and heavy propaganda once the union's recruitment drive began in November.

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"The deepest cuts are being made in the one place where there is union organising," said Marcus Courtney, a co-founder of WashTech. "That has to raise red flags." Of the 1,300 job losses - 15 per cent of the company workforce - 850 will come from cuts in Seattle, Amazon's home city, and the rest from closing a distribution centre in Georgia.

The Amazon recruitment drive has been the first substantial union organisation in America's digital economy. Yet nobody would claim the threat of collective bargaining was the only headache afflicting Amazon's top brass. The company has never made a profit on its heavily discounted books, CDs and other merchandise, and its share price has been in freefall for 10 months.

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But the turmoil gives the lie to the notion that the dot.com world is a groovier, friendlier, more lifestyle-enhancing place to work than the standard hamster-wheel of Old Economy capitalism. A year ago, Amazon's chief executive officer, Jeff Bezos, was named Time magazine's Man of the Year, largely on the strength of his ability to combine entrepre-neurial prowess with the image of a Mr Nice Guy who cared about his staff.

Then last January, 150 employees in Seattle were given an hour to pack and escorted off the premises. The company was having to rethink its strategy of growth without profitability and cut costs so increased sales did not simply translate into bigger losses.

Part of the company's customer service operation has moved to Delhi, where workers paid a fraction of their Seattle counterparts answer e-mail queries from US customers. Other divisions have opened in North Dakota and West Virginia, where employees earn considerably lower salaries and benefits than their high-class, high-maintenance, caffe latte-quaffing colleagues in the Pacific North-west.

This is the sort of corporate behaviour that brought 50,000 people on to the streets of Seattle during the 1999 World Trade Organisation summit, putting profits before people, as the street slogan had it. Both sides have taken the point to heart.

Union organisers have made job stability their main priority, and the management, mindful of the negative publicity triggered by even an appearance of corporate ruthlessness, has spent much of the past year tempering its more radical decisions with eye-catching PR manoeuvres. But shortly after union recruitment literature began circulating, Amazon's management put together talking points for supervisors to use with staff and called meetings to discuss the downsides of unionisation.

"Inform reps of the disadvantages of joining a union, including the possibility of strikes, serving on picket line, fines and dues," read one e-mail from an executive, Laurie Arnold, to Amazon supervisors. The company even held an "all-hands" meeting, which everyone, even those with the day off, was urged to attend for a lecture on the evils of unions without a balancing argument for the other side.

Mostly it was a charm offensive, rather than an exercise in overt threats. The warning was clear - think twice before organising. Amazon asked its customer service staff, the very people involved, to send out a standard response to inquiries on the issue. "While unions do have a role in society," the response read, "at Amazon.com, everyone is an owner and can exercise individual rights to raise any workplace issues or concerns at any time."

In December, four union activists who had set up a booth in the company cafeteria were told they were violating the company's non- solicitation policy and had to leave. WashTech asked why the unionists were kicked out when other booths advertising cultural events were allowed to stay, but never had a response.

Rumours of job cuts began to circulate. When the announcement came this week, alongside Amazon's fourth-quarter results, the cuts hit without apparent regard for experience or length of service. Amazon denies any link between the unionisation effort and the lay-offs, although it acknowledges high labour costs in Seattle have been a factor. The company cites the relatively soft landing it has provided for laid-off employees, including participation in a special $2.5m (pounds 1.7m) stock option trust fund maturing in 2003.