Amazon Fined $6M for Violating California Warehouse Quota Law
The state of California is hitting Amazon with a fine of nearly $6 million based on the e-commerce giant’s treatment of workers.
Last week, the California Labor Commissioner’s Office said the Seattle-based corporation violated the state’s warehouse and distribution center quota law, which limits companies from enacting and enforcing so-called “productivity quotas.”
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Enacted in January 2022, AB 701 aims to ensure that warehouse workers are given written notice of any speed quotas they must follow, including the number of tasks they’re expected to perform on an hourly basis. It also protects their rights to state-mandated meal and bathroom breaks.
The $5.9-million fine is the largest ever levied against a company under the quota law.
According to the Labor Commissioner’s office, two Amazon distribution centers in Riverside and San Bernadino counties were the subject of a nearly two-year investigation that began in September 2022. The facilities were found to have committed 59,017 violations between October 2023 and March 2024. Under the law, penalties are set at $100 per violation.
The government agency said Amazon neglected to provide employees with written notice that speed quotas were in place. While the e-tailer’s management argued it didn’t need a quota system because it utilizes a peer-to-peer evaluation model, the Labor Commissioner defines a quota as “work that must be performed at a specified speed or the worker suffers discipline.”
That was apparently the case at the Moreno Valley and Redlands facilities, the agency said. In addition to placing limits on quotas that interfere with meal and rest breaks, the law also protects workers from being subjected to quotas that could impact compliance with occupational health and safety laws. “A quota may be illegal if it is not disclosed to workers or precludes employees from exercising these statutory rights,” the Labor Commissioner’s office said.
“The peer-to-peer system that Amazon was using in these two warehouses is exactly the kind of system that the Warehouse Quotas law was put in place to prevent,” California labor commissioner Lilia García-Brower said. “Undisclosed quotas expose workers to increased pressure to work faster and can lead to higher injury rates and other violations by forcing workers to skip breaks.”
Amazon took issue with the state’s investigation, with spokesperson Maureen Lynch Vogel telling Sourcing Journal that the company has appealed the decision.
“The truth is, we don’t have fixed quotas. At Amazon, individual performance is evaluated over a long period of time, in relation to how the entire site’s team is performing,” she said. “Employees can—and are encouraged to—review their performance whenever they wish. They can always talk to a manager if they’re having trouble finding the information.”
Despite the company’s denials that it employs quotas to measure worker performance, lawmakers across the country are heeding their constituents’ complaints. California’s warehouse and distribution law has set a precedent that the rest of the nation may soon follow.
In May, Senator Edward J. Markey (D-Mass.), a member of the Senate Health, Education, Labor and Pensions (HELP) Committee, along with Sen. Tina Smith (D-Minn.) and Senator Bob Casey (D-Pa.), put forth the Warehouse Worker Protection Act, which would prohibit “dangerous” work speed quotas that lead to worker injury. It would also require companies to disclose their quota policies from the outset.
The National Employment Law Project (NELP), along with other labor rights organizations, released a report this spring showing that one in every 15 Amazon warehouse and distribution center employees suffer injuries. The company represents 79 percent of large warehouse employment in the U.S., and 86 percent of all injuries at such facilities happen under its purview.
The group’s polling of workers across the country showed that more than half of those employed by Amazon (54 percent) and Walmart (57 percent) experienced production quotas that made it difficult for them to take bathroom breaks “at least some of the time.” NELP’s reporting confirmed that quotas are also sometimes implemented without disclosure to employees, meaning they’re being held to standards they don’t know about.
“The Warehouse Worker Protection Act is about dignity, safety, and respect for the workers that make companies run,” Sen. Markey said at the time. “When corporations repeatedly use and abuse warehouse workers, they show us that their number one obligation is to their profits. This bill would guarantee that we have basic standards in place to protect warehouse workers from the worst of corporate greed and move us one step further towards true worker justice.”
“I approach this issue with the core belief that all companies should follow the law and treat their workers fairly,” Sen. Smith added. “Many workers in large warehouses that use aggressive quota systems are pushed to the brink every day and sometimes can’t even take a break to go to the bathroom.”
“This bill will protect these workers and increase transparency from warehouses that use quotas so that they can’t take advantage of their workers,” she said.
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