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New Jersey sues Amazon over drivers
The lawsuit
The lawsuit argues that Amazon cheats by hiring drivers through subcontractors known as delivery service partners. If an Amazon driver crashes, the arrangement helps shield Amazon from liability, and because the drivers are employed by the partners, Amazon is not their employer for union bargaining or labor obligations. Similar lawsuits are piling up.
On Monday, Mamdani backed municipal laws that would require Amazon to hire the drivers itself.
The cost dispute
Amazon and the model's defenders say the change would raise delivery costs, slow service, and put thousands of jobs at small contractor businesses at risk. Amazon says it could shift operations outside the city. One figure cited against the change is $664 more per household per year in New York, about $5.20 per package.
Supporters of the change put the cost of raising driver pay from about $18 or $19 an hour to $21 or $22, with benefits, at roughly 25 cents per delivery in New York.
How do courts decide who counts as employer?
In the US, courts and agencies weigh how much control a company has over a worker's schedule, pay, and methods. For union bargaining, the National Labor Relations Board has set and rewritten its joint-employer test several times since a 2015 decision. Two companies can both count as employers when both hold real control. Employer status carries duties such as bargaining and wage law compliance.
Why do firms hand work to subcontractors?
Economist David Weil described the trend in his 2014 book The Fissured Workplace. Large firms concentrate on brand and customers and shed employment to smaller contractors, which compete on cost. The pattern covers janitorial work, hotels, and package delivery. Weil headed the US Labor Department's Wage and Hour Division from 2014 to 2017.
Why does employment status decide who pays after crashes?
Under a doctrine called respondeat superior, an employer is generally liable for harm an employee causes while doing the job. Companies that hire independent contractors usually are not held liable the same way, though courts examine the facts of each arrangement. That is why labeling a worker an employee or a contractor carries large financial consequences. Rules differ from state to state.
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