FROM THE COMPANY’S
PERSPECTIVE, HAVING A
FLEET OF INDEPENDENT
CONTRACTORS TO HANDLE
LAST-MILE DELIVERIES
IS A SWEET DEAL.
68 MONEY.COM MARCH^2019
INSIDE THE CUTTHROAT WORLD OF AMAZON FLEX
C. Bernstein, a subsidiary of asset manage-
ment firm AllianceBernstein, found that
average drivers end up earning from $5 to $11
an hour. The Bernstein report says that “Flex
drivers are effectively monetizing the value of
their transportation asset by getting paid cash
today to make payments tomorrow.” Drivers
can’t always rely on tips to pad their payouts,
either. Though drivers can choose to deliver
only Whole Foods and restaurant orders,
which require a face-to-face interaction and
are more likely to prompt a tip, most Flex
blocks involve little customer interaction.
The Bernstein report sums it up accordingly:
“Doorbells don’t tip—and consumers are
much less likely to tip a person delivering a
box than a person delivering food or carrying
in groceries.”
Amazon declined to give details about the
size of its workforce and how it handles
concerns about wages.
From the company’s perspective, having
a fleet of independent contractors to handle
last-mile deliveries is a sweet deal: It doesn’t
have to pay for benefits (and it doesn’t have
to give Flex drivers the $15 minimum wage
Amazon CEO Jeff Bezos promised workers
last year). But wage issues have sparked
discussions about whether the contractors’
status should change. At least one lawsuit
has taken up this cause, claiming that
Amazon violated the Fair Labor Standards
Act by not ensuring Flexers earn minimum
wage or providing overtime.
On an earnings call last February,
Amazon CFO Brian Olsavsky said the
company intended to “continue to build our
logistics capability” going “all the way to end
delivery.” But it’s hard to say where Flex fits
into that agenda.
In November, Amazon shuttered Flex
without warning in Greensboro, N.C., leaving
drivers bewildered and without work. Over
the holidays, the Flex-themed Facebook
groups were filled with panicked posts asking
why no blocks were showing up and lament-
ing low prices, even during peak season.
Amazon also just launched a program for
Delivery Service Partners, in which a person
oversees a fleet of up to 40 vans and 100
employees. Virginia Beach Flex driver
Joel Manzer, 44, says some of his colleagues
see these so-called DSPs as the enemy
because they have stronger ties to Amazon,
can deliver more packages, and garner more
reliable business.
Adding to the drama: Several drivers who
have made headlines, like the one in Mem-
phis who got caught on camera carelessly
throwing an envelope onto a lawn, appear to
be DSP workers.
But Manzer would remind critics that
Flex isn’t designed to be a nine-to-five job. In
fact, there are normally caps in place to keep
drivers from working too many hours.
“Flexing is best used if it’s a part-time
gig,” says Manzer, who also runs a digital
marketing service for nonprofits. “If you
need an extra couple hundred bucks a week,
it’s great, but if you’re trying to do it full-
time, you’ll need to plan things out.”