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    Nordic Investors Pressure Amazon on Unionisation Rights

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    Stockholm (NordSIP) – Ahead of Amazon.com‘s upcoming annual general meeting (AGM) on May 22, eight Nordic shareholders have endorsed a proposal urging the company to assess whether it has lived up to its own commitments to respect workers’ rights to freedom of association and collective bargaining. In the past, Amazon has been criticised for interfering with workers right to unionise, including allegations of intimidation, retaliation and surveillance.

    This is but one in 14 measures that the Amazon Board of Directors is recommending shareholders oppose at its AGM.

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    The Proposal

    This shareholder proposal is known as Item 12 – Shareholder Proposal Requesting Additional Reporting on Freedom of Association” and reads: “Shareholders urge the board of directors to commission an independent, third-party assessment of Amazon’s adherence to its stated commitments to worker’s freedom of association and collective bargaining rights as outlined in Amazon’s Global Human Rights Principles, which explicitly reference the Core Conventions of the International Labour Organization and the ILO Declaration on Fundamental Principles and Rights to Work. The assessment should address any operations as well as steps to remedy any practices inconsistent with Amazon’s stated commitments. The assessment, prepared at reasonable expense and omitting confidential, proprietary or legally privileged information, should be publicly disclosed on Amazon’s website by November 30, 2024.”

    In support of this request, the proposal notes that “US regulators and court have ruled repeatedly that Amazon violated labor laws and have ordered remedies, including rerun union elections, reinstatement of terminated workers and cease and desist orders to stop discharging workers in retaliation for union organizing.” The supporting statement also cites a number of cases attrition between Amazon and unions in France, Poland and Germany.

    The proposal was led by SHARE, the Shareholder Association for Research and Education. Sarah Couturier-Tanoh, Director of Shareholder Advocacy at SHARE and a leading authority on corporate governance, decent work and human rights, says that effective and transparent due diligence is needed to reassure shareholders when repeated allegations of misconduct arise.

    “Beyond the ethical imperative to respect human rights, any failure to align workforce practices with internationally recognized human rights norms represents a threat to shareholder long-term value,” said Couturier-Tanoh. “That’s why in the past couple of years we have seen global investors taking stances in favor of better labor relations in an effort to mitigate those risks in their investment portfolio. In the past six months, several companies answered the call, including Starbucks and Apple. We are still waiting for Amazon to follow suit and, frankly, to do even better.”

    Nordic Investors

    The Nordic supporters include Denmark-based AkademikerPension and Sampension, the Council of Ethics of the National Swedish Pension Funds, Sweden-based Alecta and Öhman Fonder, Norway-based Storebrand Asset Management and KLP Kapitalforvaltning AS and Nordea Asset Management.

    “Poor corporate management of human and labour rights conflicts with the long-term interest of a company and its shareholders, and in our view represents a substantial risk to the company’s business and thus shareholder value,” said Eric Pedersen, Head of Responsible Investment at Nordea Asset Management

    Anders Schelde, CIO of AkademikerPension, said the firm “expect[s] Amazon to respect fundamental labour rights — both in order to protect the workers employed by the company, but also to protect the company itself. Amazon has so far shown unwillingness to do so. “Unfortunately, this approach indicates a lack of consideration of the risks related to labour rights violations — risks that leave the company vulnerable to operational disruptions, litigation, and consumer backlash,” Schelde added. “Neither Amazon nor us, as investors, will benefit from this.”

    Jenny Gustafsson, Executive Director of the Council of Ethics, said the Council has been engaging with Amazon on labour rights for years. “Co-filing this proposal is a way for the AP Funds to reinforce that dialogue and to further encourage Amazon to improve its practices and the implementation of its policy commitments,” said Gustafsson.

    Amazon’s Rejection

    The Board of Directors of Amazon recommends shareholders oppose this proposal. It argues that such a report was published in relation to a similar proposal in 2022 and that the present proposal does not provide any new evidence in support of the need for such a report.

    The Board also emphasises the fact that unionisation is very low and cites recent instances where workers rejected this effort by wide margins. The company also discloses that while engaging with the proponent of the proposal (presumably SHARE, but this is left unclear), it “revealed the true intent behind this proposal”, “the promotion of ‘neutrality’ agreements and a commitment by Amazon to not engage with its employees, which Amazon argues would limit its ability to communicate with individual employees.

    The reply does go some way to providing some figures about the state of labour relations at Amazon. The board argues that “in 2021 through 2023, although Amazon was one of the largest private sector employers int he U.S., employing over one million people, only approximately 445 ULP claims* were filed against Amazon during this time frame. As of March 2024 only one of those approximately 445 ULP filings resulted in a final NLRB order against Amazon, and we plan to appeal that order.” The board further notes that ULP, which is widely unionised, had twice as many complaints and that the complaints against Amazon all came from the four facilities where unions sought representation votes, arguing that unions sought to “leverage these ULP claims as part of their election campaigns.”

    Considering Amazon’s Rejection

    It should be noted that the 2022 report published by Amazon is relatively light on details and reads distinctively as though it was not written by an independent third party. It discusses policies against intimidation and internal channels through which workers can voice their concerns, but falls short of discussing any figures or cases regarding the way in which these policies are implemented or complaints are handled. One is left with a feeling that Amazon is not genuinely engaging with the concerns put forward and that it is more concerned with dismissing them; which is one of the reasons an independent auditor matters.

    Another perspective might note that workers in the USA experience distinctively higher levels of labour market insecurity and lower levels of employment protection than most European countries, not least the Nordics. Much like ULP claims do imply guilt, a lack of ULP claims is not necessarily evidence that there are no issues, particularly in the face of claims of intimidation and labour market insecurity. Workers might choose to ignore their concerns for fear of losing their jobs.

    Shareholder Proposals for Amazon AGM

    Amazon appears to not be very open to outside input. Shareholders have tabled 14 proposals for consideration at Amazon’s AGM. These include proposals on increased disclosures for political lobbying, political donations, gender/racialpay, viewpoint restriction, stakeholder impacts, packaging materials, emissions reporting, warehouse working conditions and artificial Intelligence,a mong others. The Board of Directors of the company have recommended investors oppose every single one of these measures.

     

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    * ULP fillings refer to Unfair Labor Practice complaints filed with the NLRB

    ** The NLRB is the National Labor Relations Board,  an independent US federal agency that protects the rights of private sector employees to join together, with or without a union to improve their wages and working conditions.

    Image courtesy of Joe Piette via Wikicommons
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