Amazon says it's boosting pay for contract delivery drivers

Amazon said it plans to boost wages for contracted drivers as part of a $440 million investment this year into its third-party delivery program but declined to say by how much.

The company announced the pay bump at an annual, closed-door conference called Ignite Live with the 3,500 small businesses that make up its delivery service partner program. The DSP program, launched in 2018, comprises about 279,000 drivers, often distinguishable by blue Amazon-branded vans, who are responsible for delivering packages the last few miles to shoppers’ doorsteps.

“This is going directly to DSPs, so that they can offer competitive pay to their employees, and build and retain great teams,” said Beryl Tomay, Amazon’s vice president of last mile delivery and technology, in an interview.

DSPs are “free to set their own wages and incentives,” though Amazon sets a minimum pay standard through the contracts it signs with the companies, Tomay said.

Amazon did not disclose any financial details of the program, nor what the average minimum wage is for DSP drivers. Tomay stated that DSPs pay more than the Amazon minimum wage and Amazon audits DSP salaries “on a frequent basis”. She said that the amount varies depending on the location of the contractors. Postal Service and

FedEx

while speeding up deliveries. Tomay stated that Amazon has invested $8.9 billion into the program and DSPs generated over $45 billion of revenue in the last five years. The union has been setting up pickets at about 12 Amazon warehouses across the U.S. since June to protest working conditions. This follows the April decision by Amazon to cut ties with an California-based DSP who had unionized with Teamsters. Critics have argued Amazon relies on subcontracted delivery drivers to dodge liability and avoid unionization.Amazon has previously said it respects its workers’ right to join or not join a union.