Germany: Union–Amazon conflict escalates in run-up to Christmas

Since 2013, trade union ver.di has been recruiting members among employees of Amazon and has campaigned for better wages and working conditions. Amazon opposes all collective bargaining but argues that it is a socially responsible employer. A new round of stoppages by ver.di members demanding a collective agreement began in September 2016. 

Economic background

A study on the e-commerce market in Austria, Germany and Switzerland found that the German share of the market grew by 13% in 2015. Almost half (49%) of the total turnover was generated by Amazon, another 19% by established mail order company OTTO and Zalando SE, an online fashion seller founded in 2008. Amazon’s reach is expected to expand further because the company promotes the use of its online marketplaces, fulfilment centres (Amazon’s term for warehouses) and logistics chains to other digital commerce businesses. It challenges the retail sector by delivering all sorts of goods, including fresh food since the autumn of 2016; it also challenges the logistics sector by providing one-hour delivery services through subcontracted city logistics chains.

Germany is Amazon’s second largest market and, since its debut in the German market in 1998, its business there has steadily expanded. Figures for autumn 2016 show that Amazon Germany employs 13,500 permanent workers, 2,500 of whom work at its Munich headquarters in customer services, research and development, and other service operations. A further 11,000 workers are based in nine fulfilment centres. Two new centres are under construction. Around 13,000 workers are expected to be employed on fixed-term contracts for the 2016 Christmas season.

Union conflict with Amazon

Ver.di argues that Amazon is a mail order company and, like OTTO, should put in place an agreement in line with the sectoral agreement that applies to mail order companies. At the moment, because Amazon does not pay the agreed sectoral wages or give its employees the agreed holiday and Christmas bonuses, it has an unfair competitive advantage, says ver.di. Its weekly working hours are one hour longer than those agreed in the sector and employees have fewer days of paid leave.

Ver.di also criticises the large proportion of fixed-term workers employed without any prospect of a permanent position. The union reports that workers complain of physically exhausting working conditions that include walking distances of 15–20 km per shift, very short rest periods, and monitoring and control of their speed and performance by electronic scanners. In addition, they are subject to lack of respectful behaviour by managerial staff and strong performance pressure. Trade union data suggest that sick leave averages 10–20% of all workers per shift. These working conditions, say ver.di, have gained it about 4,000 new members.

Amazon Germany has an anti-union position that mirrors that of its US-based mother company, which has argued that trade unions impact on the company’s innovation potential and dynamics. Amazon Germany’s CEO Ralf Kleber, appointed in 1999, says trade unions are not needed because the company is a responsible employer. In an interview with Wirtschaftwoche in October 2015, he also argued that Amazon is no longer a retailer claiming that it is now an infrastructure provider and logistics company, and that the company’s current wage structure is already slightly higher than that agreed for the logistics sector.

Put under pressure by the threat of industrial action, Amazon Germany has complied with the institutional framework requirements, but not to ver.di’s demands. Since 2015, the company has complied with the Works Constitution Act (Betriebsverfassungsgesetz, BetrVG) and the Co-determination Act (Mitbestimmungsgesetz). Works councils are now in place in all fulfilment centres and, since 2015, there has been worker representation on the supervisory board of the holding company responsible for the two Bad Hersfeld fulfilment centres – although they are not necessarily trade union members. The company runs a broad programme of initiatives for integrating workers into the corporate culture, including news services and blogs for each Amazon site, information on healthy conduct, financial support for local community projects, contests, events on robotisation and Oktoberfests. One campaign has featured photos of Amazon workers on public buses with captions saying they are content with their workplaces.

The current round of industrial action may not bring the conflict to an end, but once again highlights the clash of cultures and concepts.

Industrial action accelerates

Since 2013, ver.di has staged industrial action with the aim of bringing Amazon Germany to the bargaining table. A new round of stoppages started on 28 September 2016 when some 1,700 workers in five fulfilment centres and at Amazon Prime Instant Video participated in a one-day strike. There were two more day-long strikes in October and in early November. Between 25 and 28 November, the first ever three-day strike was staged at two Amazon sites in North-Rhine Westphalia. Ver.di announced there would be further action during the Christmas shopping season.

Amazon did not react, and on 6 November, Frankfurt Allgemeine reported the views of academic experts that:

  • the industrial action would have no noticeable impact on the workflow because tasks would be diverted to Amazon fulfilment centres in other EU countries during strikes;
  • in the future Amazon would be relying more on automatisation.

However, the trade unions have responded with cross-border networking. On 30 September, representatives from the Czech Republic, France, Germany, Luxembourg, Slovakia and Spain protested in front of Amazon’s European headquarters in Luxembourg, demanding trade union recognition.

The conflict is gaining widespread attention. Amazon’s fundamental opposition to collective bargaining and its trade union replacement strategies may serve as a role model for other digital commerce businesses. In response, ver.di is calling for the extension of the sectoral collective agreement in response.

Commentary

The conflict is gaining in importance because of Amazon’s fundamental opposition to collective bargaining. Its US-inspired trade union replacement strategy serves as a role model for young digital commerce businesses such as, for example, Zalando. In addition, the German E-Commerce and Distance Selling Trade Association (BeVH) argues in its annual report for 2015 (PDF) that most of its members prefer ‘direct communication’ with the workers to set wages and working conditions. ver.di’s demand that the labour minister should extend the sectoral agreements to include all e-commerce companies has also attracted attention. The digital commerce sector is seen as a major battle ground for the development of collective bargaining.

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