Amazon.com, Inc.’s (NASDAQ:AMZN) need for personnel to staff its package delivery network is so acute that it is looking inside its four walls to recruit them.
The Seattle-based e-taling giant announced on May 13 that it will pay each qualified employee up to $10,000 in start-up costs to launch their own delivery business, and will offer each the equivalent of three months of pay at their last gross salary to ease the transition from company worker to independent contractor.
Qualified employees would become part of the company’s “Delivery Service Partner” program. They would work as liaisons between Amazon and the employee’s driver workforce. The drivers are typically on the employee’s payroll, and the employee is responsible for matching blocks of work for drivers with Amazon’s seemingly insatiable demand for delivery services.
Under another program, called “Flex,” drivers contract their services directly through Amazon.
According to Dave Clark, Amazon’s senior vice president of worldwide operations, many Amazon employees have expressed interest in being business owners but were deterred by the financial uncertainties surrounding the shift to self-employment status. The payment structure provides a “path forward” for those previously reluctant to make the move, Clark said.
Launched in June 2018, the partner program has helped 200 start-ups recruit thousands of Amazon’s drivers, the company said. Amazon said it plans to add “hundreds more” new businesses in 2019, and has expanded the partnership offering to the U.K. and Spain.
A company spokesperson said Monday that the latest expansion was in the works before Amazon said late last month that it would make one-day deliveries the standard for its popular “Prime” service, down from the current two-day standard.
James Thomson, who spent years in high-level positions at Amazon and today runs a consultancy that helps businesses navigate the Amazon ecosystem, said the move underscores the company’s “immediate and large-scale” need to recruit drivers and to maximize their use once they are in the fold. Amazon’s sense of urgency is amplified by its desire to reduce its reliance on large third-party carriers like UPS Inc. (NYSE:UPS), the U.S. Postal Service and FedEx Corp. (NYSE:FDX) and to take those functions in-house.
Thomson declined comment on the specifics of Amazon’s announcement, but said it was well-timed if the company wants to reach out to individuals who drive for Uber Technologies Inc. or Lyft Inc. and who are upset about the way they are treated and how much they are being paid per ride.