Amazon’s tech staff outnumber its retail employees in Australia

Amazon now employs about 4,000 people in its Australian cloud business – almost double the number of permanent staff in the tech giant’s local retail business, which five years after the launch still relies heavily on labor hire and independent contractors.

Before a Senate Select Committee on Work and Care in Sydney, Amazon executives revealed on Monday that its Amazon Web Services workforce dwarfs the 2,000 permanent workers in its six giant Australian fulfillment centers and around 200 operational staff.

The Tech giant also uses another 1,300 labor hire workers at the fulfillment centers, and 3,000 “independent contractors” to deliver packages, with the less secure workforce being investigated by the Senate committee.

Photo: Miscellaneous Photography / Shutterstock

The temporary workers – mainly sourced from global giant Adecco – are paid $28.80 an hour – $1.37 less than the permanent workers’ hourly rate of $30.17.

Amazon also uses 3,000 “independent contractors” for its delivery service Amazon Flex, which company executives said the investigation was for workers who want “supplemental” income.

These drivers can register for three- to eight-hour blocks. They are paid $128 for a four-hour delivery block, but must cover their own expenses and liabilities. Based on minimum wage, that leaves just $10 dollars an hour to cover expenses like the vehicle, fuel and insurance.

The Transport Workers Union criticized the payment as unfair and the third-party delivery model as unsafe.

The tech giant’s executives were also questioned about a heavy reliance on labor hire at its six fulfillment centers in Sydney, Melbourne, Brisbane and Perth.

The managers said about one-third of the fulfillment center’s workers are not employed by Amazon. These workers are supplied by the Australian branch of Adecco, one of the world’s largest temporary staffing firms.

Amazon Australia’s director of operations, Mirinda Espidio-Garcia, could not answer the inquiry’s question about whether the labor hire workers end up costing the company more because of the additional fee paid to Adecco.

She defended the reliance on labor hire, saying Amazon was relatively new to the Australian market five years after launching and was still trying to understand “the seasonality of demand”.

“I think that’s absolutely our goal, as we continue to better understand those trends, to be able to continue to offer more permanent roles or permanent pathways for those labor agency employees,” Ms Espidio-Garcia said told the investigation.

She said the vast majority of Amazon’s 2,000 permanent workers in its fulfillment centers had started as temporary workers, with Labor senator Linda White suggesting the tech giant was using the model to “try before you buy” workers.

Amazon executives have also been challenged over the claim that Amazon Flex workers deliver packages only as supplemental income.

“This has long been a phrase used about all women’s earnings – it is always complementary to a breadwinner,” said Barbara Pocock, chairwoman of the Senate committee.

“Frankly, you and I have no idea what is complementary to what. The point in labor law is that we have a fair, basic standard and a living wage for workers. To say that a workforce of 3,000 people who may or may not know their salary, their workload or their work rate has the wonderful opportunity of supplemental earnings – I’m personally very uncomfortable with that language.”

Do you know more? Contact James Riley by email.