Amazon Wage Increase Includes Removal Of Stock Options, Bonuses

07 October, 2018, 02:58 | Author: Brooke Harris
  • BERNIE'S LESSON: Amazon Cuts Bonuses, Stock Options After Minimum Wage Hike

E-commerce giant Amazon's decision to raise its minimum wage to $15 per hour is expected to pressure others businesses to do the same, which could be bad news for workers, some experts predict.

"Now that activists have succeeded, they can now take that demand to other employers", said Marshall Steinbaum, a fellow at the Roosevelt Institute.

But following on the heels of Bezos' back-patting announcement was the news that paying for this wage increase means stripping away some perks like monthly bonuses and stock awards.

Independent Senator Bernie Sanders of Vermont criticized Amazon, saying it doesn't pay workers enough. Amazon says it will replace it with a program next year that will allow workers to buy stock, but didn't provide details.

Amazon said its public policy team plans to begin lobbying for an increase in the federal minimum wage, which has been $7.25 an hour since 2009. "The ones who are loyal should be rewarded for loyalty, not smacked in the face". "We're excited about this change and encourage our competitors and other large employers to join us". When explaining the changes to its employees, Amazon said the affected workers would prefer the "predictability and immediacy" of bigger paychecks over stock money they may never see.

"The significant increase in hourly cash wages more than compensates for the phase out of incentive pay and RSUs".

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"They must have a different kind of calculator than us", said an employee at a Pennsylvania warehouse, who estimated she'll lose out on about $3,000 a year. Would you prefer a higher wage or bonuses and stock options? But she earned an extra $400 a month in October, November and December, during the busy holiday shopping season when Amazon doubles the bonuses to motivate workers to show up on time and churn out packages quicker. Average hourly wages for retail workers, excluding managers, rose 4 percent in August compared with 12 months earlier.

"It's a joke", Amazon warehouse employee Vicki Shannon Allen said to NBC News.

Amazon India and Flipkart classify their delivery staff as semi-skilled, and some kinds of workers in their sorting centres as unskilled, industry members said. As McDonald's moves to overhaul its chain with remodeled stores that include more self-order kiosks, there's been speculation it will cut the need for hourly workers.

A number of retailers, including Amazon, Walmart, and Target have announced minimum wage hikes over the a year ago as the battle for talent heats up.

Low-wage workers typically receive higher pay from an expanding economy only after higher-income people have benefited, economists note.

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