New Jersey Attorney General Files Antitrust Suit Against Amazon Over Delivery Contractors

New Jersey Attorney General Jennifer Davenport announced on Tuesday that the state has filed an antitrust lawsuit against Amazon, accusing the online retailer of abusing its power over third-party delivery contractors to suppress competition and harm workers. In a statement, the attorney general's office said Amazon has prevented delivery workers from forming a union, restricted contractors in its delivery network from hiring one another's drivers, and limited labor competition, leading to lower wages and harsher working conditions than workers would otherwise face. Davenport said Amazon has built a company worth trillions of dollars while using its dominant power in the labor market to impose artificially low wages and punitive working conditions on delivery network drivers. A representative for Amazon did not immediately respond to a request for comment.

Since 2018, Amazon has operated its Delivery Service Partners program, relying on a network of thousands of small contracting companies to handle the last-mile delivery of packages from warehouses to customers' doorsteps. The model has reduced Amazon's dependence on major carriers such as UPS and FedEx while speeding up delivery. It has increasingly drawn scrutiny from lawmakers, regulators and labor advocates, who say Amazon uses the third-party contractor label to evade responsibility and avoid directly employing delivery workers while still controlling their pay, schedules and uniforms. Amazon, for its part, has argued that its delivery partners have full control over their operations.

In the complaint, filed in the U. S. District Court for the District of New Jersey, Davenport accuses Amazon of holding a 'monopsony' in the market for delivery driver services. Unlike a monopoly, which typically refers to a company suppressing competitors or consumers, a monopsony generally refers to a company that becomes the sole participant in a particular labor market, giving it enormous influence over employment conditions. The complaint says delivery service partners are economically dependent on Amazon and cannot operate independently, leaving them unable to compete for drivers by offering higher wages or better conditions, which allows Amazon to keep driver pay low.

Separately, New York City is considering legislation that would require Amazon to directly employ delivery service partner workers and take other measures.