Photo : ablokhin ( iStock ) The news sounds positive on face: Global retail overlord Amazon—which bought Whole Foods last year—will raise Amazon and Whole Foods’ employees minimum hourly wage to $15. (Fast Company reports it will also offer raises of $1 per hour to employees who earn more than that.) The change would go into effect November 1, Nation’s Restaurant News reports. Vermont Senator Bernie Sanders lauded the move, saying Amazon CEO Jeff Bezos did “exactly the right thing.” But not all Whole Foods workers are ready to pop champagne over the news. Advertisement Some are worried that while the move means a better minimum wage, Amazon-Whole Foods might try to make up those savings elsewhere, either by cutting employees’ hours or changing policies regarding their stock options. Stock options especially have been an ongoing point of contention and were part of the reason some Whole Foods employees attempted to unionize earlier this year. In a letter to fellow employees written in September, those organizers stated: “The clandestine nature of Amazon offering stock options to store leadership without informing [other employees] is beyond problematic... It is insulting and unethical.” Indeed, in announcing the $15 minimum wage, Amazon stated that it would phase out its stock option program for Amazon warehouse employees and replace it with a direct-buy system; Gizmodo reports that in September, Whole Foods CEO John Mackey promised his employees a stock equity program and said it was “actively developing a solution” to offer equity opportunities for all vested workers. Confusion reigns, and the jury is out as to whether Whole Foods employees will be cut out of gain-sharing opportunities. Workers and labor advocates are also concerned about reduced hours and increased automation at Amazon warehouses and in the Whole Foods chain. Marc Perrone, president of the United Food And Commercial Workers International Union, tells Fast Company that while any wage hike is good news, he’s waiting to see whether the company will try to make up these costs by cutting back on human labor costs: “I don’t want to be a cynic, but I would wait and see over the next six months what this really looks like. There’s no guarantee their hours are going to stay the same.” Ultimately, Amazon-Whole Foods employees are in a wait-and-see situation. It’s up to company leadership to clarify conflicting and confusing statements about stock options, and to prove that it won’t suddenly greenlight a bunch of robots to replace those peskily expensive human workers. Until then, workers can’t fully celebrate the minimum-wage increase. [Note: Gizmodo, like The Takeout, is owned by Univision Communications.]<doc-sep>Facing questions over how much it pays its workers, Amazon is responding with sweeping changes. The retail behemoth on Tuesday said that it will raise its hourly minimum wage for all of its U.S.-based employees to $15, including for subsidiary companies such as Whole Foods Market. The change, which will be enacted Nov. 1, will affect more than 350,000 employees, including seasonal workers and the thousands of Amazon employees that call Central Texas home. Amazon employs more than 1,600 hourly staff members in the Austin Metro area and more than 1,500 workers at a warehouse it opened in San Marcos in 2016. The company has 10 operating warehouses in Texas, including around San Antonio, Dallas and Houston. Whole Foods Market, which is headquartered in Austin and which Amazon bought last year for $13.7 billion, has more than 89,000 employees across 490 stores, more than 2,500 of whom work in the Austin metro area. “We wanted to be leaders on this issue,” Amazon spokeswoman Ashley Robinson said in an email interview Tuesday. “The Amazon $15 minimum wage is more than double the federal minimum wage, and it will make a difference in the lives” of Amazon employees. Amazon’s decision follows recent policy shifts at major employers and state governments to increase minimum pay. In January, Walmart announced it was raising its hourly minimum pay to $11 for more than one million of its U.S. workers. In 2016, California passed a law that will increase minimum wage at large companies to $15 by 2022. But Amazon’s change also reflects national outcry over its treatment of the numerous low-skill employees that fuel its retail empire. Records recently obtained by nonprofit news organization the New Food Economy showed that thousands of the company’s employees depend on the federal government’s Supplemental Nutrition Assistance Program, known more commonly as food stamps. Activists and labor unions have also long condemned the retailer’s warehouse working conditions, with growing media reports describing employees who are overworked and underpaid. In September, U.S. Sen. Bernie Sanders, I-Vt., introduced a bill abbreviated as the “Stop BEZOS” act, referring to Amazon CEO Jeff Bezos, that would tax large companies like Amazon and Walmart equal the amount of what employees receive in food stamps or other public benefits. "What Mr. Bezos has done today is not only enormously important for Amazon's hundreds of thousands of employees," Sanders wrote on Twitter Tuesday," it could well be a shot heard around the world." As part of its new wage policies, Amazon said that its public policy team will begin advocating for an increase to the federal minimum wage, which stands at $7.25 an hour. The company also defended its working conditions. “We use our Connections program to ask associates a question every day about how we can make things even better … and we investigate any allegation we are made aware of and fix things that are wrong,” Robinson said in an email interview. “We believe it is this commitment to our associates and operational excellence that makes Amazon a very attractive place to work.” In a written statement announcing its increase in minimum pay, Bezos, who founded Amazon in the mid 1990s, said his company “listened to our critics, thought hard about what we wanted to do, and decided we want to lead. “We’re excited about this change and encourage our competitors and other large employees to join us.”<doc-sep>Photo : Drew Anthony Smith ( Getty ) Amazon’s announcement of a universal $15-per-hour minimum wage for employees and temps stunned critics on Tuesday, earning the megacorporation unlikely praise from progressives like Senator Bernie Sanders and 2018 U.S. congressional candidate Alexandria Ocasio-Cortez. Advertisement The move is, for Amazon’s hundreds of thousands of workers, a net benefit—full stop. Tactically, it’s also a brilliant play ostensibly intended to take the wind out of the sails of a growing pro-union contingent within the company, garner goodwill for a corporation repeatedly accused of grueling and unsafe warehouse conditions, and pressure competitors that may not have other revenue sources—like Amazon Web Services—to underwrite higher wages. On one point, though, it seems the pay increase announcement backed Amazon into a corner. One of the perks Amazon touted for years when confronted with its disappointed wages was its stock option program, known as the Restricted Stock Unit (RSU) program, which all full-time warehouse workers were enrolled in and which vested after two years of employment with the company. Whole Foods was famous for a similar employee gain-sharing program—something that, according to current workers, disappeared once Amazon bought the grocery chain in 2017. But part of Amazon’s blog post yesterday notes that: We will be phasing out the [Restricted Stock Unit] grant program for stock which would vest in 2020 and 2021 for this group of employees, replacing it with a direct stock purchase plan before the end of 2019. In general, the benefit of a direct stock purchases , as opposed to paying for them on the open market, is the avoidance of broker fees. But beyond that general framework, Amazon doesn’t expound further on the scope of the replacement program. Dissolving the RSU program for higher base pay seems like a fair enough trade, if Whole Food’s CEO John Mackey hadn’t written the following in a letter to all team members on September 12 (emphasis his): We will create an Amazon stock equity program for all our Team Members with at least 6,000 service hours. Last spring, Amazon granted Restricted Stock Units (RSUs) to all Whole Foods leadership from Associate Store Team Leader level and up. We have heard from many Team Members who expressed disappointment about not providing equity opportunities for all long-tenured Team Members as we had previously done with the Whole Foods Stock Option Plan. I want you to know that we are actively developing a solution with Amazon that will address these concerns. We reached out multiple times to both Amazon and Whole foods for comment and have yet to receive any clarification on this apparent discrepancy in marching orders. Whatever the resolution, the company is effectively hamstrung: Either Amazon’s directive supersedes Mackey’s, or the company ends up with a two-tiered system where warehouse workers aren’t offered stock but grocery store workers are. Stock options may be a major sticking point, both because these internal statements appear to stand in contradiction and because gain-sharing is a major concern for organizing Whole Foods employees. But the confusion and lack of response are indicative of the rollout of these changes more generally. Advertisement Some Whole Foods workers are unsure how the rising base pay will affect their store’s labor budgets. Members of online forums where Amazon workers gather seem equally confused by edge cases—like the size of a raise those already making $15 or more are entitled to. “Not sure how it turned out for you but our [process assistants] and hard capped T1 associates [those who have worked long enough to receive all available raises] got screwed out of pay from $.25-$1/hr+. All hands was a complete shit show,” a Redditor claimed, citing anger over the loss of stocks and variable-compensation pay, a bonus given to employees when a warehouse exceeds its monthly productivity goals. (Amazon confirmed VCP was being phased out.) Amazon’s $15-per-hour move is a step in the right direction for America’s second-largest employer, but for organizers, it needs to be the first step of many.<doc-sep>
Amazon is raising wages, but it might not mean much for blue-collar workers handling orders at the company’s local warehouses or stocking shelves and checking out customers at Whole Foods stores. That’s because the minimum wage in San Francisco is already $15 an hour — the amount Amazon plans to equal or surpass for all its workers, including those at its Whole Foods subsidiary. Some people who are already making $15 will also see an increase, but neither Amazon nor Whole Foods responded to requests for comment about whether San Francisco workers will get those additional raises. An hourly wage of $15 is more than twice the federal rate of $7.25. But it still doesn’t stretch far in San Francisco’s housing market, as working 40 hours a week all year at $15 would bring in just over $31,000. A Bay Area household would have needed at least $219,380 in annual income to make the monthly payment on a median-priced, single-family home in the second quarter of 2018. Job postings on Amazon’s website Tuesday showed a range of positions, with wages of “up to $13.50” an hour in San Mateo and “up to $16.50” an hour in San Jose. There were no job listings at Amazon’s Prime Now warehouse in San Francisco’s Dogpatch neighborhood, which serves as a base for the company’s two-hour delivery service. The building is set to be demolished to make room for housing. Whole Foods, which Amazon bought for $13.7 billion last year, does not include wages in its job postings. But the upscale grocery chain advertised immediate openings at stores in the Castro and Potrero Hill on Craigslist. The starting pay appears to be $16.25 an hour; some positions advertise a $500 bonus after new hires put in 100 hours. Dave Clark, Amazon’s senior vice president in charge of operations, shared the news in person with hundreds of employees at a warehouse outside San Bernardino. A video of the moment that Clark posted on Twitter shows workers cheering and jumping in response. Amazon’s move could be aimed at heading off a political storm. Sen. Bernie Sanders, I-Vt., introduced legislation called the Bezos Act last month to tax large companies like Amazon whose employees require government assistance to cover their most basic needs, such as food stamps or health care. “We listened to our critics, thought hard about what we wanted to do, and decided we want to lead,” CEO Jeff Bezos said in a statement. Sanders tweeted his approval Tuesday, saying that the move was “not only enormously important for Amazon’s hundreds of thousands of employees, it could well be a shot heard around the world.” Interactive Vaccine Tracker: Latest developments Detailed information about the coronavirus vaccines as it becomes available. Amazon said it will start advocating for an increase to the federal minimum wage. Amazon’s new minimum, which takes effect Nov. 1, will affect more than 250,000 Amazon employees, as well as over 100,000 seasonal employees who will be hired at Amazon fulfillment centers across the U.S. in the holiday season. Melia Russell is a San Francisco Chronicle staff writer. Email: melia.russell@sfchronicle.com Twitter: @meliarobin