Amazon cuts to bonuses lead to questions about wage hike

A spokesperson for Amazon said the ending of stock vesting plans and bonuses makes compensation “more immediate and predictable.”
by Jason Abbruzzese, David Ingram and Michael Cappetta /

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Enthusiasm for Amazon’s decision to raise the minimum company wage to $15 per hour has been tempered by concern that the company may be short-changing some of its more senior warehouse workers.

As part of Amazon’s new pay structure, the company ended its bonus and stock incentive programs for warehouse and customer service workers. Those payments rewarded workers for staying with the company and for working consistently.

"It's a joke," said Amazon warehouse employee Vicki Shannon Allen, who made headlines this summer after she made videos documenting her experience as a homeless Amazon employee. "We get no more bonuses for not missing any work. "

Shannon also said she has concerns over what will happen to the portion of her income that was delivered in the form of stock options.

Amazon drew broad approval on Tuesday when the company announced that it would be setting a $15 hourly minimum wage for its workers. The company had been under pressure from activists and politicians who claimed Amazon warehouses employees were underpaid and overworked.

Amazon warehouse workers who spoke to NBC News on Tuesday said they were supportive of the move, but did note that the stock incentives had provided a significant bump in pay. One said that some workers were frustrated that newly hired employees would be receiving sizable wages that had taken veteran workers years to earn.

A spokesperson for Amazon said the ending of stock vesting plans and bonuses makes compensation “more immediate and predictable.”

The spokesperson also said the increased hourly wages “more than compensates” for the incentive programs.

“We can confirm that all hourly Operations and Customer Service employees will see an increase in their total compensation as a result of this announcement,” the spokesperson said.

Stacy Mitchell, co-director of the Institute for Local Self-Reliance, a non-profit group that has been critical of Amazon’s practices, said it is not immediately clear how Amazon’s change would affect veteran workers but said that they could lose out on future earnings if the end of the stock program is combined with slower raises.

“Obviously there are a fair number of people who have gotten a raise, and that’s clearly important,’ she said.

But she added, “It’s not going to get any higher for at least the next couple of years... There’s a flattening of the pay structure.”

Sen. Bernie Sanders, I-Vt., had been one of the most vocal politicians calling for Amazon to raise its wages. He praised the company and its CEO, Jeff Bezos, on Tuesday, noting that the company said it would also be helping in the push to make the national minimum wage $15 per hour. The current national minimum wage is $7.25 per hour.

Sanders said in an emailed statement in response to questions about the stock and bonus programs that he hopes Amazon’s change does not end up hurting veteran workers.

“Our understanding is that the vast majority of Amazon workers are going to see wage increases, including some very significant increases as the minimum wage goes up to $15 an hour,” Sanders said. “I would hope that as a result of Amazon’s new policy, no worker, especially long-time employees, sees a reduction in total compensation. Amazon can afford to make all workers whole and should do that.”

Jason Abbruzzese contributed reporting.

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