Amazon Pledges $1 Billion to Boost Pay and Cut Healthcare Costs for 500,000 Workers

Amazon Invests Over $1 Billion to Boost Pay, Cut Health Care Costs for Fulfillment and Transportation Workers SEATTLE - Amazon announced on Wednesday that it will invest more than $1 billion to raise wages and lower the cost of health care plans for its U.S. fulfillment and transportation workers. The move aims to improve working conditions and benefits for thousands of employees. According to Amazon, the average pay increase will be over 23 per hour, with some of its most tenured employees seeing an increase between $1.10 and $1.90 per hour. Full-time employees, on average, can expect a yearly pay increase of $1,600. The company also plans to lower the cost of its entry health care plan to $5 per week and $5 for co-pays starting next year. "This investment is a significant step forward in our commitment to supporting the hardworking men and women who make Amazon possible," said an Amazon spokesperson. "We believe that investing in our employees' well-being and compensation will not only improve their lives but also contribute to the success of our business." The move comes after seven Amazon facilities went on strike last December, led by the Teamsters union, which aimed to pressure the e-commerce company to improve working conditions and benefits for its workers. Amazon's global workforce stands at 1.5 million workers, with a significant portion employed in fulfillment and transportation roles. The company has faced criticism in recent years over its treatment of warehouse workers, including allegations of poor working conditions and inadequate compensation. The investment is expected to have far-reaching implications for the e-commerce industry as a whole, with other companies potentially following suit. "This move by Amazon sets a new standard for the industry," said a labor expert. "It's a recognition that the cost of living is increasing and workers need better pay and benefits to keep up." Amazon's decision to invest in its employees' well-being also highlights the growing importance of worker welfare in the age of automation. As AI and robotics continue to transform the workforce, companies are being forced to re-evaluate their treatment of human workers. The investment will be phased in over the next year, with full-time employees seeing the largest pay increases. Amazon has not specified how it plans to fund the investment, but a spokesperson said that the company is committed to finding ways to make it work within its existing budget. As the e-commerce industry continues to evolve, one thing is clear: companies like Amazon are being forced to adapt to changing workforce needs and societal expectations. With this investment, Amazon is taking a significant step towards improving working conditions and benefits for its employees - a move that could have far-reaching implications for the industry as a whole. Background: In 2022, Amazon faced criticism over its treatment of warehouse workers, with allegations of poor working conditions and inadequate compensation. The Teamsters union led a strike at seven Amazon facilities in December 2023, calling for improved working conditions and benefits. Amazon's global workforce stands at 1.5 million workers, with a significant portion employed in fulfillment and transportation roles. Additional Perspectives: Labor experts say that Amazon's decision to invest in its employees' well-being sets a new standard for the industry. The move highlights the growing importance of worker welfare in the age of automation. Other companies may follow suit, as the e-commerce industry continues to evolve. Current Status and Next Developments: The investment will be phased in over the next year, with full-time employees seeing the largest pay increases. Amazon has not specified how it plans to fund the investment, but a spokesperson said that the company is committed to finding ways to make it work within its existing budget. As the e-commerce industry continues to evolve, companies like Amazon will be forced to adapt to changing workforce needs and societal expectations. *Reporting by Fortune.*