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Amazon to pay $1.9 million in contract worker exploitation settlement

Packages move along a conveyor belt at an Amazon Fulfillment center on Cyber Monday in Robbinsville, New Jersey, on Monday, Nov. 28, 2022.

Stephanie Keith | Bloomberg | Getty Images

Amazon will pay more than 700 migrant workers roughly $1.9 million to settle claims they suffered human rights abuses as a result of exploitative labor contracts in Saudi Arabia.

In a blog post Thursday, the company said it hired a third-party labor rights expert, Verité, last year to investigate conditions at two of its warehouses in Saudi Arabia. Verité identified numerous practices in violation of Amazon’s supply chain standards, the company said.

Last October, an Amnesty International report, as well as an investigation from the International Consortium of Investigative Journalists, Arab Reporters for Investigative Journalism, and the Guardian, detailed accounts of grim conditions for migrant workers at Amazon warehouses in Saudi Arabia.

Migrant workers, many of whom were Nepalese, were deceived by third-party recruiting agencies into thinking they would work directly for Amazon, and forced to pay unlawful fees to obtain employment, the Amnesty report said. While they worked at Amazon warehouses, the workers were housed in accommodations that were “overcrowded and dirty, infested with bed bugs and lacking even the most basic facilities,” Amnesty wrote. In some cases, the agencies prevented employees from changing jobs or leaving Saudi Arabia unless they paid hefty fines, which they often couldn’t afford without taking out burdensome loans.

The abuses suffered by workers were so severe that they likely amounted to “human trafficking for the purpose of labor exploitation as defined by international law and standards,” Amnesty wrote in the October report.

Amazon said it became aware of the issues before reports from groups like Amnesty. The company said Verité interviewed employees at of one of its temporary labor vendors, Abdullah Fahad Al-Mutairi Co., and found worker-paid recruitment fees, “substandard living accommodations, contract and wage irregularities, and delays in the resolution of worker complaints.”

Amazon confirmed through a series of audits in recent months that AFMCO had “remediated the most serious concerns,” including by upgrading housing accommodations.

It also “secured AFMCO’s commitment” that after workers’ employment ends at Amazon, the agency will pay them in line with their contracts and won’t move them to an accommodation that fails to meet Amazon’s standards. The report from the Guardian and other outlets detailed how workers whose contracts had ended were moved to even more squalid housing, and, lacking income, struggled to afford basic necessities like food.

“Our goal is for all of our vendors to have management systems in place that ensure safe and healthy working conditions; this includes responsible recruitment practices,” Amazon wrote in the blog post.

Amazon’s labor record has been heavily scrutinized in recent years. Lawmakers, politicians and advocacy groups have zeroed in on its treatment of warehouse and delivery workers, arguing they’re exposed to unsafe working conditions. It faces multiple ongoing federal probes into its safety practices, and it has been fined by federal safety regulators for exposing workers to ergonomic risks in its warehouses.

Amazon has disputed regulators’ allegations, and it has said it continues to invest in worker safety. It also has said it has made progress on lowering injury rates, including through introducing more automation in its facilities.

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