Amazon Bumps Wages to $15 per Hour — But it Could Backfire for Workers

Amazon received plenty of press and praise last week when it raised the minimum wage for all employees to $15 per hour. The retail giant announced the change as a positive and leveraged it for positive buzz, but not all employees are happy about the new system.

The fatal flaw of a higher minimum wage is that the money for this increase has to come from somewhere — and Amazon is no exception. To pay for those rising wages, Amazon is also slashing bonuses for high performing employees. Those top performers received additional pay based on their productivity and the way they benefitted the company. For some, the loss of these bonuses (awarded for hard work) mean a net loss of up to $300 per month.

Holiday and seasonal employees could be the hardest hit; like all retailers, Amazon has intensive warehouse, shipping and logistic needs at the holiday season. The added employees would often return each year, and both seasonal and regular employees enjoyed hefty bonuses during the months of November and December, to reward commitment and hard work. According to Wired, these bonuses are being eliminated to make way for the $15 minimum wage for all.

In addition to the loss of performance based bonuses, Amazon is also ending a lucrative stock program for employees. The Restricted Stock Unit or RSU program allowed workers to invest after just two years, resulting in gains as the company grew. This program, again designed to reward performance, is being removed to make way for the $15 minimum wage.

According to Amazon, the phase out of RSU’s is due to employee demand; in a recent blog post, the company said: “we’ve heard from our hourly fulfillment and customer service employees that they prefer the predictability and immediacy of cash.”

While Amazon feels that the hourly increase will replace any losses due to the removal of performance rewards and incentive:

“We can confirm that all hourly Operations and Customer Service employees will see an increase in their total compensation as a result of this announcement. In addition, because it’s no longer incentive-based, the compensation will be more immediate and predictable.”

According to WIRED, at least one employee they spoke with will lose about $1400 each year because of the shift in compensation. Amazon did not dispute this when they were approached by WIRED for confirmation.

While Amazon’s increase in minimum wage appeals to those fighting for this very thing, the consequences to long term, high performing hourly employees is actually negative in many cases. The very employees that are relied on to help run the company are the ones being negatively impacted by this “positive” change. As brands continue to face pressure to increase minimum wage, the plight of the long term, high performing Amazon workers should be considered so that any increases are truly beneficial to all.

~ Conservative Zone


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21 responses to “Amazon Bumps Wages to $15 per Hour — But it Could Backfire for Workers”

  1. Typical “socialist” move, destroy incentive for the benefit of the under producers, to make everyone the same, which also makes the output of production the same for all, as little as one can get away with, which will be low as they now will be compensated for only being there and getting paid for only the time they spend there, not for the production that the better employees gave their efforts for reward, which this will eliminate, and now will make all employees low producers. This is what causes the demise of all socialist and communist systems of government, for they all do the same, pander to the least productive for so called compassionate and empathetic reasons, causing all to be low producers.

    • My wife works for Amazon & the day they announced this crap..I know I felt the ground shake around here!!
      She has been there for (x) number of years & they all decided (at least in her warehouse) the production was going to fall off the charts!! The only way they WEREN’T F**KED was that they didn’t mess with their insurance! I guess Amazon is going to find out the hard way!! And I wish I could tell everyone about all the things they are doing with all the illegals!!
      IT WOULD MAKE HILLERY LOOK LIKE AN INNOCENT ANGEL!!

    • The only socialism involved is the billions in our tax dollars that provide government benefits to employees of Amazon and Walmart because they don’t pay a living wage.

      • A “Living wage” is what YOU are responsible to find and attain – it isn’t an employer’s responsibility to supply it just because you “need” it. If you are responsible for putting your cart before your horse, and putting yourself in a situation that you “need” more money than the job you can get pays – that is on YOU. It might be tough, but that is what my tough Daddy taught me.
        This is EXACTLY socialism – take away any incentive or reward for superior performance so you can make everyone equal? Textbook socialism…

      • That is exactly why production will fall dramatically. When all make the same, there is no incentive to work. This is a form of socialism. I have lived in countries with a form of socialism. Just try to get something done. The work is shoddy to say the least if they even show up and do anything. Big brother will take care of you. Go to school and get skills and earn what you deserve.

  2. This is a typical Communism-style move, and it will KILL Amazon’s productivity and bankrupt them, as the beginners so erewarded will do nothing but help them to fail miserably.

  3. What will they write on thier Tombstone. “Death by Socialism. ” High performance employees will move on, and they shit ones will stay.

  4. The first colonies in Massachusetts and Virginia were socialist and after three years of near starvation and failure finally allowed colonists to have their own plots and businesses on the side. Only then did they prosper.
    Why the liberals can’t see this reality is that they don’t look at human nature.
    There is no such thing as a free lunch.
    “Those who flunk history are doomed to repeat it.”

  5. Did you notice how happy was Bernie the communist, when Amazon announced the wage increase? He does not look very happy know that the company has to cut down, does he? The same formula that brought down the old Soviet Union. Eliminate the incentives for the productive workers and so make all equal with “misery” I wold say to Bernie: smart up old communist, and if you are not happy got in the communist “paradise” of Cuba, or go leave in Russia or China. Please go hypocrite.

  6. Go back in history, to the days of the “free lunch”, which it turns out wasn’t “free”, patrons being expected to buy drinks. NOTHING it seems is without costs, today just like yesterday, and likely tomorrow too.

  7. In case earlier comment was less than clear, the following will, I hope, address any failures. Obviously, top level management, those who make the rules that mere employees must play by, are not willing nor are they likely to make financial sacrifices. That said, the costs of this increased hourly wage must be born elsewhere , where else but the compensation of other employees, in this case, those who might be more productive. They will loose such extra compensation as they formerly received, so that the compensation of others might be increased. The Justice or lack of Justice inherent in this arrangement depends on where on the totem pole you are located.

  8. As has always happened every time in the past, productivity will decline because of loss of incentive, and will cause a loss in sales and profits, putting the long established highly profitable company on the down turn from it’s long term historic record increases in sales and profits, the beginning of the end as a downward spiral will ensue. It seems that liberals can never learn from the past, they have to suffer through what they convince themselves are great ideas, but has always caused failure every time it has been pursued in the past.

  9. Let’s see what happens when productivity fall through the floor…….. when people stop renewing their PRIME memberships when they can’t get the product out of the warehouse in two days. Bezos better re-think this one, his days of being at the top of the wealth charts might be numbered on this goof.

  10. A common problem when an ungodly entrepreneur becomes successful using capitalism but then becomes a practicing democrat, socialist or communist after acquiring the wealth and power.
    Satan’s dream for you is to have a passion for wealth, power, fame, luxury and instant gratification of every lust and desire at the expense of family, friends … and Godly tenets.
    God’s plan is for you to establish an eternal personal relationship to have love, joy, peace, patience, kindness, goodness, faithfulness, gentleness self-control and much more.

  11. Back in 1938 when it was eventually ‘finalized’, the minimum was set at $0.25 per hour. Periodically, there were calls to increase it, and the justification was always the same, essentially. The point is, setting a federal minimum wage, like virtually ALL “rob Peter to pay Paul” legislation has NEVER satisfied “Paul” except for a short period of time. A recent ‘side effect” of raising the STATE minimum wage was that many welfare recipients got ticked off when their ‘free stuff’ was reduced. The money must come from ‘somewhere’ but eventually, the taxPAYERS get it in the neck because INFLATION is also a side effect and when it gets high enough, the same politicians begin saying that ‘welfare recipients’ need an increase in their ‘ferr stuff’. They could raise the minimum wage to $200.00 per hour and STILL there come politician critics in a few months or years saying it needs to be increased again – and usually it is the same politicians who always see a need to increase what ‘someone’ else pays in order to keep those politicians in office.
    Aside from adding to the cost of labor, hence the cost of goods and services, there is another ‘inflation’ factor that keeps the cycle repeating itself – the ever increasing amount of borrowed money the government gets – money that is not based on productivity.

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