After making headlines over a purported lack of protections for employees, Amazon has revealed plans to give up all of its projected profits next quarter as it spends billions of dollars in an attempt to improve safety conditions for workers.
The e-commerce behemoth, which logged a mixed Q1 after the closing bell on Thursday, announced that it typically expects to make $4 billion in profits in the second quarter. But this year, it anticipates to spend “the entirety of that $4 billion, and perhaps a bit more” on coronavirus-related expenses.
“Providing for customers and protecting employees as this crisis continues for more months is going to take skill, humility, invention and money,” founder and CEO Jeff Bezos said in a statement. “If you’re a shareowner in Amazon, you may want to take a seat, because we’re not thinking small.”
The costs, shared the company, will go toward providing personal protective equipment for associates and higher wages for hourly workers, as well as improving sanitation at facilities and building its own testing capacity. It predicts that operating income for the quarter will be as high as $1.5 billion or as low as a loss of $1.5 billion.
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“The service we provide has never been more critical, and the people doing the frontline work — our employees and all the contractors throughout our supply chain — are counting on us to keep them safe as they do that work,” Bezos added. “We’re not going to let them down.”
Over the past few weeks, the online powerhouse has had to contend with workers across its ranks falling ill with COVID-19, leading employees as well as elected officials to raise concerns regarding conditions in its facilities. What’s more, some of its workers had been planning a “May Day” strike — along with employees from other corporations, including Walmart and Target — to ask for improved health and safety standards on top of hazard pay.
To protect workers from contracting the virus, Amazon said it has staggered shifts, placed markings on its floors and added signage to remind employees to adhere to social distancing practices. It has also increased the frequency of cleaning at all sites, particularly high-touch surfaces such as elevator buttons, door handles and touch screens. Additionally, the Seattle-based company said it has been conducting temperature checks as well as providing face masks and hand sanitizer to employees in warehouses in the United States and Europe, plus at Whole Foods stores.
In addition to taking health and safety precautions, Amazon has invested $700 million to boost pay for employees during the pandemic. All of its employees who are diagnosed with COVID-19 or otherwise placed into quarantine receive up to two weeks of pay, which the retailer said is meant to ensure workers do not worry about lost income while battling the illness.