Amazon associates at a UK warehouse reportedly plan to strike for six days in April in a dispute over pay, according to Reuters. Additionally, the retailer is reportedly facing a $1 billion class action lawsuit that claims its Buy Box has been used to direct sales to its own products rather than help shoppers find the best deal, according to CNBC.
The GMB trade union has announced that more than 560 workers in Coventry will walk out from April 16 through 18, then again from April 21 through 23, marking the fourth straight month of intermittent striking.
“Six further days of strike action in Coventry is a clear statement from our members [that] they are worth more; they will not accept a pay rise of pennies from one of the world’s wealthiest corporations,” said Amanda Gearing, Senior Organizer at GMB in a statement.
The associates are seeking higher pay from Amazon to keep up with record-high inflation rates, which hit a 41-year high of 11.1% at one point in 2022. Amazon increased starting pay by 50 pence to between 10.50 and 11.45 pounds ($12.95 to $14.12) per hour last year, which is higher than the minimum wage of 10.42 pounds set to take effect in April.
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“We regularly review our pay to ensure we offer competitive wages, and we recently announced another increase for our UK teams,” a spokesperson for Amazon’s UK unit said in a statement emailed to Reuters.
Lawsuit Hinges on Amazon’s Algorithm
The class action lawsuit in the UK claims that Amazon uses a “secretive” algorithm to abuse its position as an ecommerce giant. The suit claims that Amazon is harming its customers by directing them to its “featured offer” and potentially hiding better deals.
Additionally, the lawsuit alleges that Amazon uses its “Buy Box” to direct customers toward its own products and third-party items that use Amazon fulfillment services. Amazon is accused of ensuring that “the Buy Box nearly always features goods sold directly by Amazon itself, or by third-party retailers who pay hefty storage and delivery fees to Amazon.”
“Millions of consumers have paid too much and been denied choice,” said Lesley Hannah, Partner at Hausfeld, which is leading the litigation. “This action seeks fair redress for them. Amazon takes advantage of consumers’ well-known tendency to focus on prominently-placed and eye-catching displays, such as the Buy Box.”
Hausfeld has claimed that between 80% and 92% of Amazon purchases are made on the Buy Box, and anyone who lives in the UK and made a purchase on Amazon since October 2016 falls under the claimant class.
Amazon has called the claims “without merit” and believes it will be cleared through the legal process. “Amazon has always focused on supporting the 85,000 businesses that sell their products on our UK store, and more than half of all physical product sales on our UK store are from independent selling partners,” an Amazon spokesperson told CNBC. “We always work to feature offers that provide customers with low prices and fast delivery.”
