Home >Union raises tax and employee concerns over Amazon

Union raises tax and employee concerns over Amazon

16 January 2014

GMB, the union for staff in distribution, has written to local councillors across the country to ask them to look carefully at tax and staff issues if Amazon wants to set up a fulfilment centre in their area.

GMB says Amazon’s "refusal to pay proper taxes or to treat its workers properly gives it an unfair competitive advantage”.

The union also alerted councils that it believes Amazon plans to double the number of warehouses it operates in Britain in the next three years.

In the UK Amazon has eight fulfilment centres, totaling over 5 million square feet and over 4.3 million cubic feet of storage capacity.

GMB national organiser Martin Smith said: "Amazon relies on a road network funded by taxpayers for the business to business delivery of products to warehouses and for the business to customer delivery to private homes. It relies on large numbers of staff to receive the goods, to pick and pack them to meet customer orders.

"Where it differs from other retailers is its refusal to pay proper taxes or to treat its workers properly. This gives Amazon an unfair competitive advantage and is part of the reason why so many established high street names are going to the wall.

"Amazon pays its staff just above the national minimum wage of £6.31 per hour. Paying a minimum wage rather than a wage workers can live on obliges taxpayers to top up wages for staff with families. Working families tax credit is a subsidy to a company like Amazon which pays little corporation taxes.”

Amazon responded to the allegations by defending its employment record.

The company said: "In the UK, new associates (employees) start at a median wage of £7.05 (11% above the national minimum wage) increasing progressively to a median of £8.02 after 24 months. In addition, all permanent associates receive stock grants which over the past five years have added an average of 12% to base pay annually. This means that, on average, an Amazon associate with two years’ service will be earning £8.98 per hour for a day shift or £10.78 per hour for a night shift. Other benefits for permanent employees include private medical insurance, a company pension plan, life assurance, income protection and an employee discount.”

Amazon employs more than 4,800 permanent employees in the UK and has invested over £1 billion in its UK operations. It also says it hired 2,300 permanent employees in its UK fulfilment centres in 2013 alone.

Amazon offers on-the-job training and opportunities for career progression with over 300 employees promoted in the last 18 months.

The internet giant declined to comment on its tax position.