Who’s the Boss? Amazon Contractors Sue to Find Out

(Bloomberg) -- Amazon.com was sued by Illinois delivery drivers who say the company failed to pay them overtime for hauling its goods. Among the questions the judge will have to answer? Whether they actually worked for Amazon.

“Amazon controls everything, without a shadow of a doubt,” says Theron Bradley, a former employee of Amazon contractor Silverstar who's one of the named plaintiffs in the proposed class action. “Silverstar pays me, but I definitely know I work for Amazon.”

Bradley's lawsuit, filed this week in Chicago federal court, targets not just the contractor that signed his paychecks but the e-commerce behemoth itself. In the complaint, he contends Amazon was so involved in his day-to-day work as to be a “joint employer” and as such, liable for the alleged violations under both state and federal law. Drivers have also brought wage-and-hour lawsuits naming Amazon as an employer in Washington State and California.

Amazon sees its relationship with the drivers differently. “The small and medium-sized businesses that partner with Amazon logistics have their own employees and are required to abide by applicable laws and Amazon's Supplier Code of Conduct,” the company said in an e-mailed statement. “We investigate any claim that a provider isn't complying with these obligations.” (An attorney for Silverstar said Wednesday it was still investigating the allegations.)

But labor advocates say when it comes to contracted workers like Bradley, Amazon is much more than a mere consumer of services. “The trainings were done by Amazon personnel, the daily assignments were given out by Amazon personnel, Amazon personnel tracked the routes taken by the drivers, they wore Amazon logos,” says the workers' attorney, Chris Williams. “If there was a problem with package delivery, they went to Amazon. They didn't go to Silverstar.”

The Illinois lawsuit is among the latest in a series of efforts by activists, attorneys, and agencies to hold name-brand companies accountable for the conditions of workers they rely on but are ostensibly employed by someone else–be it a supplier, a franchisee, or (if they're classified as independent contractors) no one at all. In 2012, guest workers at a Louisiana seafood supplier went on strike over alleged forced labor and mounted simultaneous protests targeting Wal-Mart Stores Inc. in the U.S. and Mexico. In 2014, California legislators passed a law increasing company liability for labor law violations by contractors. Last month, McDonald's Corp. agreed to a $3.75 million wage-and-hour settlement with workers at five franchisee-run restaurants that had sued the corporation as a joint employer.

“More and more, businesses are varying organizational and staffing models,” David Weil, chief of the U.S. Department of Labor's Wage and Hour Division, wrote last January in an Administrator's Interpretation. He said that “as a result, the traditional employment relationship of one employer employing one employee is less prevalent.” Weil, who before joining the Obama administration wrote a book about how the “fissuring” of employment structures has hurt workplace standards, emphasized the breadth of who federal law deems to be an employer, and the need to expand enforcement beyond the company that signs a paycheck.

In the litigation context, being able to target the larger, deeper-pocketed defendant does increase the potential for a more lucrative outcome, for workers and their lawyers. But it may also lead to change for more employees.

“Where joint employment exists,” Weil wrote, “one employer may also be larger and more established, with a greater ability to implement policy or systemic changes to ensure compliance.”

To contact the author of this story: Josh Eidelson in Washington at jeidelson@bloomberg.net.

To contact the editor responsible for this story: David Rovella at drovella@bloomberg.net.