Retail/cloud computing giant Amazon announced Tuesday that it would raise the minimum wage to $15 an hour for all its U.S. employees and push for a higher federal minimum wage.
The wage is effective beginning November 1 and includes employees hired through temp agencies. This affects more than a quarter-million Amazon employees and 100,000 seasonal employees, the company said.
The move comes as Amazon has come under fire for poor wages and working conditions. A book published earlier this year contains an account of Amazon workers forced to urinate in water bottles to meet workplace targets, Wired reports; a Guardian investigation in July found Amazon workers suffering from workplace accidents, sometimes denied workers’ compensation or fired.
Amazon, which owns Whole Foods, was also found recently to be distributing anti-union videos to the grocery chain, Gizmodo reported last week. And the company quashed a “head tax” in Seattle, which would have charged employers grossing more than $20 million a year based on the number of people they employ, and funded homeless services to the tune of $47 million per year.
Amazon’s CEO, Jeff Bezos, is the richest person in the world, the New York Times reports.
Senator Bernie Sanders, who has aggressively criticized the retailer (and even introduced a bill called the Stop BEZOS Act, which would have taxed employers whose employees rely on public benefits), praised the wage hike.
“What Mr. Bezos has done today is not only enormously important for Amazon’s hundreds of thousands of employees, it could well be a shot heard around the world. I urge corporate leaders around the country to follow Mr. Bezos’ lead,” he wrote on Twitter.
The company also promised to campaign for a higher federal minimum wage, but provided few details on what that might look like. “We believe $7.25 is too low. We would look to Congress to decide the parameters of a new, higher federal minimum wage,” the company wrote.
But there’s a possible ulterior motive to the raise. Wired reports that the move might make the retail giant more competitive to workers as it staffs up for the all-important holiday season; it could reduce employee turnover, which saves Amazon money in the long run, and it could put a shine on the company’s forthcoming announcement (due sometime before the end of the year) on the location of its second headquarters. Whichever city is chosen for the new location, it is expected to give Amazon massive tax breaks in exchange for bringing jobs to the region. “The last thing the company needs is the announcement to be overshadowed by concerns about how it treats its low-wage workers,” Wired writes.
The higher minimum wage could be a direct attack on brick-and-mortar stores, too, the Wall Street Journal reports, making “it harder for traditional retailers to hire the staff they need. The result could be lost sales or, worse, crowded stores without enough staff, sending shoppers online, most likely to Amazon.”
Rachel Kaufman is Next City's senior editor, responsible for our daily journalism. She was a longtime Next City freelance writer and editor before coming on staff full-time. She has covered transportation, sustainability, science and tech. Her writing has appeared in Inc., National Geographic News, Scientific American and other outlets.