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Amazon Prime Day: Worker Strikes and a Site Crash Dent the Online Shopping Bonanza

Amazon Prime Day: Worker Strikes and a Site Crash Dent the Online Shopping Bonanza

By Abha Bhattarai, The Washington Post | Updated: 17 July 2018 10:58 IST

Amazon.com workers, who have long gone on strike in the run-up to the holidays, have found a new occasion to get their employer's attention: "Prime Day."

Nearly 1,800 Amazon workers in Spain went on strike Monday during Prime Day, the company's biggest sales day of the year, according to labour activitists. Thousands more Amazon employees in Germany are expected to walk off the job Tuesday, the second day of the 36-hour sale, for similar reasons. The unions that represent the warehouse workers, Comisiones Obreras and Verdi services union, say they are calling for better working conditions, pay and health benefits.

"The message is clear - while the online giant gets rich, it is saving money on the health of its workers," Verdi spokeswoman Stefanie Nutzenberger said in a statement on the German union's website.

Prime Day, which Amazon created four years ago, has grown rapidly in recent years and now brings in billions in sales for the company. On Monday, the sale kicked off at 3pm - and almost immediately crashed Amazon's website and mobile app for about 45 minutes. "UH-OH," said a message on the company's app. "Something went wrong on our end." Amazon said it was trying to fix the problem.

The Prime Day computer glitch - which appeared to be the most widespread to date - and worker strikes added up to a spate of bad news for the online giant, which has been heavily promoting its discount event for weeks.

"There is no doubt that this will erode sales and deter some customers from buying," said Neil Saunders, managing director of research firm GlobalData Retail. "The outage is especially problematic as many of Amazon's Prime deals are promoted for a set window of time - something that could cause a great deal of frustration for potential customers."

This week's labour protests underscore a growing challenge for Amazon: It is facing increased scrutiny over its hiring and labour practices at a time when it is looking to add thousands of new warehouse workers and growing at breakneck speed.

Amazon and its billionaire founder, Jeff Bezos, have a long history of thwarting unionisation efforts in the United States. (Bezos also owns The Washington Post, where last week unionised employees approved a new contract with the newspaper company after 14 months of tense negotiations.)

But in Europe, where unionization is more widespread, labour unions have been on the front lines of calling for workers' rights at the company's warehouse facilities, where physical demands can be gruelling and temperatures can reach extremes. Until now, though, most of their efforts have been centred on the critical holiday season. In November, for example, hundreds of Amazon workers in Italy and Germany went on strike, saying they were under "high pressure to create more and more in less time."

A spokeswoman for the Seattle-based giant said it was committed to providing workers with "positive working conditions."

"Amazon is a fair and responsible employer and as such we are committed to dialogue, which is an inseparable part of our culture," spokeswoman Melanie Etches said in an email.

This week's strikes have also inspired widespread calls on social media platforms for shopper boycotts.

In the United States, advocacy groups are planning several consumer rallies outside Amazon-owned Whole Foods Market locations to protest the sale of Nazi, Confederate and white nationalist merchandise through Amazon's marketplace of third-party sellers. There have also been widespread calls on social media for shoppers to boycott Amazon during Prime Day, which continues through Tuesday.

"People are demanding change, not just from politicians but also businesses," the Action Center on Race and the Economy said in a statement promoting Whole Foods protests. "The goal of #PrimeDayofAction is to raise awareness about the harmful practices of the nation's largest online retailer and to ask: is there anything Amazon won't do for a dollar?"

It is too soon to tell, protest organizers said, how the workers' strikes might affect shipments throughout Europe. "It is a priority of Amazon to serve and keep our customers' delivery promises," said Etches, the Amazon spokeswoman.

Employee walkouts in Germany are expected to affect six warehouses, while labor organizers in Spain say about 96 percent of workers at the company's San Fernando warehouse outside Madrid are on strike. (Amazon disputed that figure and said "the majority" of employees at the Spanish facility were at work Monday.)

"Amazon is a massive behemoth - it will take more than a strike in Spain to rattle its cage," said Peter Horst, founder of marketing consulting firm CMO. "But at the same time, these strikes create a moment for consumers to pause and say, 'What's happening here? I love these low prices, but I'm also starting to have sympathy for some of these workers.'"

He and others pointed to Walmart, Amazon's largest competitor, as a cautionary tale. The company has become the world's largest retailer, mostly by offering rock-bottom prices, but it has also received widespread criticism for the treatment of its workers, some of whom say they have had to rely on government programs to make ends meet.

This year's Prime Day is expected to bring in $3.4 billion for the company, up from an estimated $2.4 billion a year ago, according to retail research firm Coresight Research. Despite the event's rocky start, Amazon said demand continued to be high.

A number of other retailers, including Target, Macy's, Kohl's and eBay, are also promoting discounts throughout the week.

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