Why is Amazon threatening to axe 5,000 delivery jobs over Zohran Mamdani’s labour law in New York? What govt can do
Amazon has warned that it could cut more than 5,000 delivery jobs and shut down 15 last-mile facilities across New York City if a proposed labour law backed by Mayor Zohran Mamdani is enacted, setting up a potential clash between the e-commerce giant and the city’s push for stronger worker protections, the New York Post reported.
The proposed Delivery Protection Act would require Amazon to directly employ more than 5,000 delivery drivers who currently work through around 40 independent third-party contractors across New York’s five boroughs.
Amazon, however, relies on contractors rather than directly employing its delivery drivers in the US.
The legislation would therefore force the company to reconsider a central part of its logistics model.
According to a report by the New York Post, the company could respond by withdrawing its contracted delivery operations from the city and closing 15 last-mile facilities.
Such closures could put another 2,000 warehouse employees at risk, taking the potential job losses well beyond the delivery workforce directly covered by the bill, the report says.
The proposed legislation seeks to change how large delivery companies organise and manage their workforces. Under the bill, Amazon would have to directly employ thousands of drivers who currently deliver packages through third-party contractors.
The proposal forms part of a broader effort by Mamdani and labour advocates to improve conditions for workers in the city’s delivery economy.
No vote has been scheduled on the bill, leaving room for negotiations over its provisions.
Amazon’s warning reflects its resistance to changing a delivery model built around third-party contractors.
Rather than directly employing drivers, the company works with independent businesses that recruit and manage delivery workers.
Logistics analysts cited in the New York Post report say Amazon could follow through on its threat if the bill passes, pointing to the company’s willingness to shut facilities rather than substantially alter its operating arrangements.
The potential response would not be limited to drivers. If Amazon closes its 15 last-mile stations in New York City, approximately 2,000 warehouse workers could also be affected.
The company could instead shift some operations to facilities outside the city, including locations along the New Jersey Turnpike, the report said.
Amazon has argued that closing its city facilities would lead to longer delivery times and higher prices for customers. Same-day and early-morning deliveries could be particularly affected.
A study funded by Amazon estimated that the legislation could cost New Yorkers an additional $664 a year, or about $5.20 per package, including deliveries by other companies.
Amazon’s response to the proposed New York law has drawn comparisons with its decision to close facilities in Canada's Quebec last year.
The company shut seven warehouses in the province after a unionisation drive at its Laval facility. The closures affected around 1,900 warehouse workers and 2,800 contracted delivery workers.
The episode has become a point of concern for labour advocates and contractors in New York, who fear Amazon could similarly withdraw from the market rather than accept a change to its employment arrangements.
Amazon has denied that its Quebec closures were linked to the unionisation drive.
The proposed law has also raised concerns among the independent businesses that currently operate Amazon’s delivery services.
Some contractors cited in report warn that a shift in the company’s operating model could threaten their businesses and the jobs they support.
A possible compromise could allow third-party contractors to continue handling deliveries while requiring Amazon to provide stronger guarantees on worker safety and conditions, according to the New York Post report.
The outcome could also depend on the final wording of the legislation and the extent to which it requires direct employment.
For New York, the challenge is balancing better working conditions with the risk that a major employer could scale back its operations.
The potential New York cuts come as Amazon is reducing its workforce globally and increasing spending on artificial intelligence infrastructure.
The company recently cut just under 1,000 jobs, mainly in retail teams across countries including India, the US and the UK, as part of broader layoffs expected to affect around 30,000 roles.
At the same time, Amazon is preparing to spend a record $220 billion on data centres, chips and other AI infrastructure.
Bhanu Pratap is a journalist who reports and writes on foreign affairs, India’s foreign policy, geopolitics and strategic affairs. He closely follows diplomatic developments in New Delhi and has a keen interest in defence and national security.<br> <br> Bhanu also focuses on in-depth, interview-based reports and regularly speaking with experts and policymakers to bring perspectives and context to major developments around the world.<br> <br> He is also interested in stories with strong humanitarian angles.<br><br> One such report examined the cases of Indian nationals who were allegedly recruited and forced into Russia’s war against Ukraine. While reporting the story, Bhanu spoke to the families of those affected and documented their experiences. The report was later taken into account by the United Nations in its findings on human rights violations linked to the war in Ukraine.<br> <br> For Bhanu, the zeal to produce meaningful and impactful journalism remains at the heart of his work.<br> <br>He has previously worked with Firstpost, NDTV, Newslaundry and Republic.<br><br> Bhanu studied at the Delhi School of Journalism, University of Delhi. He initially chose science with plans to pursue engineering, influenced by conventional expectations, but fate had other plans and eventually led him to journalism.<br><br> Beyond the newsroom, Bhanu enjoys exploring culture and history and often spends his days off on heritage walks. He is also passionate about travelling, biking and listening to folk music.<br> <br>For tips, reviews and suggestions, you can reach him at bhanu.pratap@htdigital.in.
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