Amazon Cuts Some Pay Incentives As It Raises Minimum Wage

Amazon CEO Jeffrey P. Bezos

Amazon CEO Jeffrey P. Bezos

"We listened to our critics, thought hard about what we wanted to do, and decided we want to lead", read a short statement attributed to Jeff Bezos, the world's wealthiest man. "We're excited about this change and encourage our competitors and other large employers to join us".

It remains to be seen whether Amazon's decision to do this generous act by raising the minimum wage will satisfy its critics, but surely this move is a step in the right direction for the company's workforce, which would undoubtedly be jealous of it all employees worldwide.

According to CNBC, Target is set to raise its minimum hourly wage for employees to $15 by 2020, while rival outlet Walmart said it is also planning to boost its minimum wage to $11.

But did he really raise the minimum wage?

- Amazon made a big splash this week with its $15 an hour minimum wage announcement, but lost in the fine print: Existing warehouse workers will no longer receive stock in the company or collect bonuses.

In a statement, the independent senator said, "Our understanding is that the vast majority of Amazon workers are going to see wage increases. The current rate of $7.25 was set almost a decade ago", Jay Carney, Amazon's head of global corporate affairs, said in a prepared statement.

Amazon is also positioning this lobbying effort as moral, but that may not be the only reason the e-commerce giant would be incentivized to do it.

"In that way, Amazon could be "weaponizing" policy, according to economist Michael Farren of the right-leaning think tank The Mercatus Center, which is generally against government regulation".

Sanders' letter to CEO Steve Easterbrook follows news this week that Amazon will offer $15 an hour in November to more than 250,000 current employees, along with 100,000 more seasonal workers - drawing praise from the Democratic lawmaker himself.

Workers in stores already tend to make less than workers in distribution warehouses on average.

You read that right: in the U.S. it is entirely possible to work full-time for a highly-profitable company (in this case, one owned by the world's richest man) and still earn so little that you live below the federal poverty line.

Workers across the country have pushed for a $15 minimum wage, most notably as part of the movement known as Fight for $15.

Amazon giveth and Amazon taketh away.

Amazon said it reviews compensation annually to ensure it is competitive. By those estimates, the EPI projects that the pending $15 minimum wage hike would cost California 400,000 private-sector jobs, with heavy losses in both the food service and retail sectors.

"Amazon's business model is premised on constant innovation", Farren said.

Latest News