Is Amazon a new bad Apple?
(MoneyWatch) For years, Apple (AAPL) has been the technology company most prominently dogged by high-profile labor problems, typically on the part of its manufacturing partners in Asia. But another major tech player is increasingly the unwanted focus of attention for its allegedly harsh treatment of employees: Amazon (AMZN).
Only Amazon's problems aren't limited to the developing world. Instead, they appear in such bastions of development as Germany, where the company faces claims of foreign worker mistreatment and that it employed neo-Nazi guards, and in the U.S., where warehouse employees reportedly were made to work under unnecessarily difficult conditions.
And unlike with Apple, these issues appear to be taking place not at a subcontractor, but rather within Amazon's own warehouses. That could prove a much tougher problem, and image, to reform.
The most recent charges came from a German television channel, whose documentary alleged mistreatment of more than 5,000 temporary workers at German distribution centers. Among the claims were that workers were told on arrival in the country that their pay would be cut below what was promised, faced intimidation and regular personal searches in temporary quarters, and that security guards wore clothing identified with far-right political elements. The firm responsible for security at the Amazon facilities, Hensel European Security Services, or H.E.S.S., has denied connections with the far right.)
Amazon is claiming that it did not contract the security firm, although a spokesperson for the company's German branch also said that it had immediately terminated H.E.S.S. The apparent contradiction may be an issue of Amazon running many parts of its business through subsidiaries that are separate companies. The company did not respond to CBS MoneyWatch questions.
That is the sticking point that makes Amazon's potential labor problems much worse than those of Apple. The issues that the latter faced were at large independent companies. That allowed Apple to claim some distance from the problem, although ultimately it had to accept responsibility and increase its oversight of operations.
Amazon has no such potential excuse or mitigation. The problems in Germany were preceded by the 2011 story in the Morning Call newspaper of at least one Pennsylvania warehouse of the company where employees complained of brutally hot conditions, an unreasonably driving work pace and frequent threats of job loss.
Eight months later, CEO Jeff Bezos announced at the 2012 annual meeting that the company would retrofit its warehouses with air conditioning.
Another story last year detailed the physically driving pace at the retail giant's fulfillment centers and the toll that took on employees. Doctors who treated workers injured on the job were also said to have been pressured to act as though the injuries weren't work-related, avoiding the need to report the incidents to the federal government.
Although Apple was long able to keep its labor problems under wraps, increased public attention has forced the company to take action to improve conditions for worker. For Amazon, the question now is whether it has reached a similar "Apple moment" in its treatment of employees.
Image courtesy of Amazon.com