Breaking News
Home / Business / Amazon assures Bernie Sanders that workers would not lose money in new pay system
Amazon assures Bernie Sanders that workers would not lose money in new pay system

Amazon assures Bernie Sanders that workers would not lose money in new pay system

E commerce giant Amazon pushed back on any concerns that some hourly workers will earn less under its new pay policy by reiterating in a letter to Sen. Bernie Sanders (I-VT) that its minimum wage hike outweighs the cuts to stock bonuses and incentive-based pay that rankled some of its employees.

Amazon’s senior vice president of global corporate affairs, Jay Carney said that the significant increase in hourly cash wages effective 1st of November more than compensates for the phasing out of future (restricted stock unit) grants and incentive pay.

He added that in addition, because it is no longer incentive-based, the compensation will be more predictable and immediate.

Carney said that hourly employees will be keeping the stock grants that are vesting in 2019 and 2020. The company is also implementing a direct stock purchase plan for its workers, he said.

Sanders who has been a longtime critic of Amazon’s pay practices, initially praised the e-commerce giant for raising its minimum wage to $15 for roughly 350,000 employees which includes 100,000 seasonal employees. The company subsequently confirmed that it was cutting stock bonuses and incentive pay as part of the policy shift. This prompted Sanders to send a letter to Amazon earlier this week asking for further details on this.

Amazon employees has told The New York Times and various other outlets that they expect to earn less money under the new policy despite the increase in minimum wages.

Earlier, Sanders championed a federal bill that would make it mandatory for  large employers such as Amazon to pay a welfare tax to cover the costs of employees that relied on government programs. The senator has been very critical of the pay disparity between the company’s CEO Jeff Bezos and it’s hourly workers. He even argued that some of the employees were forced to use food stamps to make ends meet.

Amazon seems to have brought a change to the pay structure in a clever manner.  First it raised the minimum wage and then it cut stock bonuses and incentive pay.  Whatever the company’s tactics may be, the workers should not suffer and any business decision should be in favor of them.  It is yet not clear what impact Amazon’s new pay practices will have on its bottom line.

About Michael Taylor

mm
Michael Taylor, Team Leader at Feed Ride, graduated in Textile Design from F.I.T. He has a lot of experience in business as it was his passion and he started it as a profession at an early age. His bold and bright personality allows him to fearlessly collect data and information from many sources. His experience and influence helps provide the website with all the latest news in Business niche.

Check Also

Bill Ackman reveals $900 million bet on Starbucks, sees shares doubling in the next three years

Bill Ackman reveals $900 million bet on Starbucks, sees shares doubling in the next three years

Bill Ackman of Pershing Square Capital revealed on Tuesday at a conference in New York that …

Leave a Reply

Your email address will not be published. Required fields are marked *