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A tiny startup union dealt a major blow to mighty Amazon, in the form of a successful union vote at a fulfillment center on Staten Island, NY led by a worker who had been fired two years ago, a move that backfired on the multi-million-dollar effort to thwart the organizing effort.
But the matter is far from settled as Amazon is sure to challenge the vote, which ended up at 2,654 in favor and 2,131 opposed to joining the fledgling Amazon Labor Union at JFK8, with 67 ballots being challenged, according to the National Labor Relations Board, which is overseeing the election.
“We want to thank Jeff Bezos for going to space, because while he was up there, we were signing people up,” said Smalls in a victory lap quote. He was fired on March 20, 2020 after leading a walkout to protest working conditions at the front end of the pandemic; the company said he was terminated for violating social distancing policies.
“We’re disappointed with the outcome of the election in Staten Island because we believe having a direct relationship with the company is best for our employees,” Amazon said in a prepared statement. “We’re evaluating our options, including filing objections based on the inappropriate and undue influence by the NLRB that we and others (including the National Retail Federation and U.S. Chamber of Commerce) witnessed in this election.”
According to the New York Times, federal filings indicate Amazon spent $4.3 million in 2021 alone on what the paper called “anti-union consultants” and had a response team with no less than 11 vice presidents. Christian Smalls, the fired Amazon worker behind the organizing effort, said AWU raised $120,000, mostly through GoFundMe.
Meanwhile, a separate union re-vote at an Amazon fulfillment center in Bessemer, AL, is too close to call. As of Thursday, there were 993 votes against vs. 875 votes in favor, but 413 ballots are being challenged and aren’t counted in the current totals. The NLRB’s regional director could decide to open and count any of the challenged ballots, pending a hearing yet to be scheduled. Only 39% of the roughly 6,100 eligible workers voted.
That effort is being led by the Retail, Wholesale and Department Store Union (RWDSU), which forced a second vote this year after it challenged the initial election in April 2021, claiming Amazon interference. The company won that vote in a landslide, but with an even smaller percentage voting, 30% of those eligible.
Observers noted the relative success of the grassroots effort on Staten Island vs. the more organized and better funded push of the RWDSU, which some in Bessemer may have been more wary of than the very plugged-in team at JFK8. There, some organizers took jobs at the facility in order to better connect with the rank and file. The effort hit a bit of a speed bump in November, when organizers mysteriously withdrew their union petition shortly before a planned meeting with the NLRB, but the unknown issue was resolved and things moved ahead.
Amazon has experienced labor issues before in the U.S., including walk-offs and work stoppages at a few facilities in the past couple of years as the pandemic raged and workers complained not enough was being done to keep them safe. The company has consistently countered with its $18 starting hourly rate, ahead of most in the industry, plus tuition, paid family leave and healthcare benefits.
But if the JFK8 vote holds up – and Amazon will throw its considerable resources behind an effort to unwind it – this would mark the first union beachhead here. There have been Amazon unions at FCs in Europe for years, including in France, Italy, Spain and Germany.
Marc Wulfraat, president and founder of MWPVL International, which tracks Amazon’s fulfillment empire, called the Staten Island vote “a significant moment” in Amazon’s history. He said he believed the vote will stand and cause a domino effect in other markets where labor is strong, such as Chicago.
“It’s too early to say how much impact this will have on Amazon’s business operations or operating expenses but suffice to say this has the potential to move the needle in terms of business disruption and controllable expenses,” Wulfraat said.
Morgan Stanley analysts estimate that for every 1% of Amazon’s frontline workforce that unionizes, it will cost the company another $150 million in annual operating expenses, per CNBC.
Given labor scarcity, unions will continue to make gains, especially with an aging population and shifting demographics. Retail and ecommerce companies have already been raising base rates and offering generous bonuses and other incentives like flex work just to stay competitive.
“These are challenging times for retailers and this is expected to worsen,” Wulfraat said. “Warehouse automation will become the new norm to reduce reliance on labor, but these projects are very capital intensive and take years to implement.”