Amazon Union Vote Fuels Workers’ Rights Debate
A narrowly failed attempt to establish a union at the tech giant has prompted shareholders to mull further escalation.
An unsuccessful effort by thousands of employees to secure union recognition at one of Amazon’s UK warehouses has raised further questions as to how much of a risk workers’ rights represent for investors.
The much-publicised vote to recognise the GMB Union at the tech giant’s fulfilment centre in Coventry, West Midlands, was a tight one. A total 2,600 workers voted in the Central Arbitration Committee-ordered ballot, with 49.5% votes in favour, and 50.5% against – falling short by just 28 votes for a victory. If GMB had won, it would have been the first time that Amazon recognised a union in the UK.
Investors have been vocal on the issue for years, pressing the company on its human rights track record and employee treatment through various shareholder proposals. Just last month, UK-based asset manager CCLA sent a letter expressing concern over alleged anti-union messages posted on notice boards at the Coventry warehouse and long meetings where management was critical of the union.
“Despite Amazon’s policies outlining commitment to the International Labour Organization’s (ILO) Core Conventions, the ILO Declaration on Fundamental Principles and Rights at Work, and the UN Universal Declaration of Human Rights, concerns persist in respect to how these are implemented by the business,” the letter read.
The statement was backed by 50 investor signatories representing more than US$1.2 trillion in AUM, including Nest, the Church of England Pensions Board (CoEPB), Scottish Widows and Nordics-based groups Alecta, Folksam, Sampension. The latter is also part of an 11-strong coalition of Danish pension funds which have collectively engaged with Amazon since 2022 on employees’ right to unionise and collectively bargain on wages.
“Unfortunately, the result wasn’t a shock, but [is] still disappointing,” Chloe Horne, Social Themes Lead for Responsible Investment at Nest, told ESG Investor. “One of the reasons we signed that letter was because we heard from Amazon workers on alleged use of anti-union tactics, such as intimidation, retaliation and surveillance.”
Horne suggested those tactics were “undoubtedly going to undermine Amazon workers’ and GMB’s efforts to gain full union recognition”, almost certainly impacting the outcome of the vote given the small margin.
“Issues to do with workers’ and labour rights aren’t necessarily something you can screen or diversify away from,” she said. “They’re a systemic risk, which means that if you’re a diversified investor it will impact your portfolio one way or another.”
As such, investors should utilise the levers and influence they have at hand to encourage companies to improve practices as it relates to these issues, Horne added.
Useful tools
Earlier this year, both CCLA and Nest joined global institutional investors in filing a shareholder resolution at Amazon’s 2024 AGM, calling on the company to appoint a “reputable third-party” to produce a gap analysis of its practices – as opposed to using its own labour standards policy.
With 37% of independent shareholder votes, the resolution did not pass – but it still secured the highest backing of any vote at the meeting.
“Despite not winning majority support, it’s still a big number and signifies that along with all of the other investor engagement efforts we’ve seen, there’s a clear and consistent message coming through from investors that Amazon aren’t meeting our expectations on these issues,” said Horne.
In April, GMB took legal action against Amazon over what it branded as “widespread attempts” to coerce staff to cancel their trade union membership, as well as alleged anti-union messages being delivered by management to staff in meetings during working hours.
According to CCLA, an alleged US$14 million has already been spent by Amazon to quash unionisation efforts – including US$4 million on consultants brought in to dissuade workers from joining such organisations.
CCLA’s Better Work Lead Martin Buttle highlighted that in the ILO’s Declaration on Fundamental Principles and Rights at Work, freedom of association and collective bargaining are recognised as part of these fundamental rights.
“They are core human rights,” he said. “For any investor who purports to respect human rights, to do due diligence and to ensuring that their investments and the equities that they own align with human rights – freedom of association and collective bargaining rights are core to that.”
Last year, a Rathbones-backed freedom of association and collective bargaining resolution was passed at Starbucks, which led to the coffee giant’s board signing an agreement with US labour union Workers United early in 2024. Buttle highlighted this as an example of a resolution that has led directly to positive change for workers.
Nest is involved in several initiatives focused on the subject, including the ShareAction Good Work Coalition – which works with companies to encourage them to pay the real living wage – and the Fair Reward Framework. The latter was co-developed by the CoEPB and Brunel Pension Partnership, and in a consultation document last year described unions as a “recognised bulwark against income inequality”.
“Initiatives such as these are an important lever that investors can use to see progress in companies,” said Horne, adding that Nest has not ruled out further escalation on the topic with Amazon and is evaluating internally which steps would be most appropriate if it chose to do so.
Meanwhile, CCLA intends to keep monitoring news stories and information on working conditions and labour rights across all of its portfolio investments – particularly for companies where this has been a controversial topic subject to heightened scrutiny in recent years, such as Amazon.
“We will absolutely be keeping a close eye on those issues, and I expect us to remain engaged on this topic into the future,” said Buttle.
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