Owners of Amazon delivery companies, known as delivery service partners, are struggling to hire workers and have recently received letters from Amazon with threats of termination.
“Amazon hereby notifies your company that your company is in breach of certain requirements of the Program Agreement.
If your company fails to cure the breach, Amazon may terminate the Program Agreement and end the business relationship between Amazon and your company,” the emails said.
Amazon also stated in the email that it would place the companies in “poor” standing making them ineligible for bonuses until the “breach” was “cured.”
Even if the breach was “cured,” Amazon said it would consider the “breach of contract” when determining whether to renew the delivery company’s contract in the future.
Amazon said the company needed to meet 100 percent of its route assignments for four consecutive weeks by December 16.
Amazon delivery companies are legally independent from Amazon, but if faced with trouble hiring, they can’t simply pay more—they receive a set amount of income from Amazon per delivery route, so they’re functionally limited in what they can pay by what they are making from Amazon, reports say.
Delivery companies don’t have the ability to make their own business decisions, yet they front their own capital and take on a huge amount of liability, while Amazon can cut them off at any moment.
“Amazon is using [these letters] as a ‘cover your ass’ to not renew [delivery service partners] that it doesn’t like,” an Amazon delivery company owner said. “Amazon is trying to find a cause to terminate [them].”
“The assertion that we are “threatening to terminate” the contracts of Delivery Service Partners that are facing hiring challenges is simply untrue,” said Maria Boschetti, an Amazon spokesperson.
“In fact, we have invested hundreds of millions of dollars this year alone to help DSPs around the country increase driver wages and offer financial incentives to attract drivers to their small businesses.”
Because of the pandemic, large and small businesses, particularly in retail and service, have struggled to hire workers as the economy has reopened. Some have dealt with this by raising wages and offering large sign-on bonuses.
Amazon’s controlling approach toward its delivery companies often translates into pressure on its delivery drivers. Now, delivery company owners are struggling to find methods to cure the breach before peak seasons such as Black Friday and Christmas.
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