The retail giant is no longer steering customers away from the court system, as companies scramble to find ways to avoid lawyers who file mass-arbitration claims
Companies have spent more than a decade forcing employees and customers to resolve disputes outside the traditional court system, using secretive arbitration proceedings that typically don’t allow plaintiffs to team up and extract big-money payments akin to a class action.
Now, Amazon. AMZN -0.14% com Inc. is bucking that trend. With no announcement, the company recently changed its terms of service to allow customers to file lawsuits. Already, it faces at least three proposed class actions, including one brought May 18 alleging the company’s Alexa-powered Echo devices recorded people without permission.
The retail giant made the change after plaintiffs’ lawyers flooded Amazon with more than 75,000 individual arbitration demands on behalf of Echo users. That move triggered a bill for tens of millions of dollars in filing fees, according to lawyers involved, payable by Amazon under its own policies.
Amazon’s decision to drop its arbitration requirement is the starkest example yet of how companies are responding to plaintiffs’ lawyers pushing the arbitration system to its limits.
Amazon customers have one week to opt out of a plan that would turn every Echo speaker and Ring security camera in the US into a shared wireless network, as part of the company’s plan to fix connection problems for its smart home devices.
The proposal, called Amazon Sidewalk, involves the company’s devices being used as a springboard to build city-wide “mesh networks” that help simplify the process of setting up new devices, keep them online even if they’re out of range of home wifi, and extend the range of tracking devices such as those made by Tile.
But Sidewalk has come under fire for the apparent lack of transparency with which Amazon has rolled out the feature, as well as the limited time available for users to complete the tricky process required to opt out. Other critics have expressed concerns that failing to turn the setting off could leave customers in breach of their internet service provider’s terms and conditions.
SEATTLE — Amazon, the second-largest private employer in the United States, is also a leader in another category: how often its warehouse workers are injured.
New work-related injury data from the Occupational Safety and Health Administration showed those jobs can be more dangerous than at comparable warehouses. Since 2017, Amazon reported a higher rate of serious injury incidents that caused employees to miss work or be shifted to light-duty tasks than at other warehouse operators in retail.
In 2020, for every 200,000 hours worked at an Amazon warehouse in the United States — the equivalent of 100 employees working full time for a year — there were 5.9 serious incidents, according to the OSHA data. That’s nearly double the rate of non-Amazon warehouses. In comparison, Walmart, the largest private U.S. employer and one of Amazon’s competitors, reported 2.5 serious cases per 100 workers at its facilities in 2020.