Amazon turns grocery workers into Whole Foods employees

An independent contractor wearing a protective mask and gloves loads bags of Amazon Prime groceries into a car outside a Whole Foods Market in Berkeley, California on October 7, 2020.

David Paul Morris | Bloomberg | Getty Images

While Amazon has struggled to come up with a cohesive grocery strategy in the 15 years since it began dabbling in delivery, the Covid-19 pandemic has made one thing abundantly clear: consumers have less and less desire to browse the aisles of supermarkets.

The rest of the industry has also understood this. Now Amazon is streamlining its grocery delivery operations as it faces growing competition from Walmart, supermarket chains like ShopRite and Albertsons, and apps like Instacart and DoorDash.

In late February, Amazon told workers picking up items for delivery that they would soon be working for the company’s Whole Foods division, according to a letter sent to employees and viewed by CNBC. Instead of offering gig work so contractors can take short shifts and fill batches of grocery orders, workers will become Whole Foods employees with longer shifts.

“To help continue to provide the best experience for our team and our customers, we are transferring online grocery fulfillment operations currently operated by Amazon to Whole Foods Market by the end of the year,” the letter reads. . “This transition will be slow for the majority of stores.”

A Whole Foods spokesperson has confirmed that US shoppers will become Whole Foods employees by the end of the year.

According to a job description recently published by Whole Foods, schedules will be set up to three weeks in advance and cover two-week periods. Compare that with a recent job posting for an Amazon shopper, which listed “flexibility of shifts” and the ability to “work as little as four hours a week,” in a section describing job benefits.

The change marks Amazon’s latest effort to simplify its vast grocery and brick-and-mortar retail operations, which have grown to include two supermarket chains, convenience stores and clothing stores. Its biggest expansion came in 2017 with the purchase of Whole Foods for $13.7 billion, Amazon’s largest acquisition.

Amazon kicked off a one-hour grocery pickup on Wednesday at all Whole Foods stores nationwide.

Amazon

Last week, Amazon announced it would close all of its bookstores, pop-up stores and 4-star stores, which are expensive businesses that have failed to gain enough traction. And earlier this year the company overhauled its physical stores management, hiring Tony Hoggett, a veteran of British supermarket chain Tesco, to oversee the unit.

Amazon wrote in the Whole Foods Buyer Letter that the latest change will “create a more unified team culture,” among other benefits.

Some workers are unhappy with the change. On Reddit, Amazon shoppers expressed concerns about the transition, including uncertainty over whether they’ll have to reapply for their jobs or have the same level of flexibility with the new job. The Whole Foods spokesperson said workers won’t have to reapply and the company is working to provide shoppers with flexible scheduling options.

“Supposed to be a side concert”

Robert Bruno, an employee of Whole Foods in Massachusetts, told CNBC that the new structure takes away many benefits in terms of flexibility. Amazon shoppers can have other jobs, and the shorter shifts allow them to create their own schedule.

“It’s supposed to be a side gig for a lot of people,” Bruno said, in an email. “If there are changes in terms of schedule/length of shifts, I can easily see a lot of people leaving.”

Amazon piloted the change in some Whole Foods locations, according to the letter. A store employee said workers had to fill online orders and help with other tasks when needed, such as packing groceries, stocking shelves and operating cashiers .

The person, who was not authorized to speak publicly and asked to remain anonymous, described the new role as requiring four times the amount of work for the same pay and no flexibility.

In-store shoppers must also meet certain metrics while they’re at work, similar to the productivity quotas required for Amazon warehouses and delivery people.

Amazon provides shoppers with a handheld device to scan items, which are then bagged for delivery to customers. Employees use the Shopper app, installed on the devices, to communicate with customers about item replacements, the employee said.

Amazon monitors activity, such as the so-called item-not-found rate, or how often employees fail to locate an item because it might be out of stock. It also tracks how often they offer item replacements and the percentage of grocery pick-up jobs shoppers accept. The app will remind workers to continue shopping if they haven’t scanned an item after 15 minutes, the employee said.

Bruno said Amazon also measures what it calls units per hour (UPH), showing how quickly shoppers pick up items. Each Whole Foods location has a certain UPH target, and the number in its store is 66, he said.

“If it’s far enough below that number, like in the 40s, then they’ll talk to you about it and maybe fire you if it’s too low,” Bruno said.

The Whole Foods spokesperson confirmed that Amazon is following certain measures.

“Like most companies, Amazon has performance expectations for every Amazon employee and measures actual performance against those expectations,” the spokesperson said. “Employee performance is measured and evaluated over a period of time, as we understand that various factors can impact the ability to meet expectations on any given day or time.”

Amazon shoppers typically process between 15 and 20 orders a day, though that number can vary depending on whether it’s busy or slow, according to a “Day in the Life” video posted by Whole Foods on YouTube.

“Honestly, I got fitter doing this job because of the walking and commuting and stuff,” the worker says in the video.

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