More than 1,200 workers lost their jobs after Amazon ended their contracts with several delivery firms, CNBC reported Thursday.
Amazon’s Delivery Service Partner (DSP) program provides contracts to entrepreneurs who start their own delivery companies, giving them “the support infrastructure, technology, and a suite of exclusive services” to deliver packages, according to Amazon’s blog.
Amazon’s decision to cut ties with at least 7 small delivery firms comes after the company said in an August 7 blog post that their delivery partnership program has grown rapidly since it was launched in 2018. About 1,205 workers were laid off as a result of Amazon ending the contracts, CNBC reported.
The companies are also shutting facilities across the country. Systemize Logistics, which is located in Massachusetts, laid off 121 workers as they closed facilities in Connecticut and New York, according to the report. TL Transportation, based in Maryland, cut 76 jobs when they shut down a location in New York and laid off 80 workers in Pennsylvania. Sheffield Express announced that they are closing their Connecticut location and laying off 95 employees. (RELATED: BP To Slash 10,000 Jobs As Coronavirus Creates Slump In Energy Markets)
“We have ended relationships with some partners and Amazon is working closely with all impacted drivers to ensure they find opportunities to deliver Amazon packages with other local Delivery Service Partners with little to no disruption to pay,” an Amazon spokesperson told CNBC.
At least 2,000 workers were laid off when Amazon cut ties with several delivery companies beginning in February, according to the report. (RELATED: Amazon To Hire 100,000 New Workers Because Of Coronavirus)
Arizona-based company IntelliQuick Delivery described losing their contract with Amazon as a “complete shock.”
“This comes as a complete shock to our company as a whole and I can assure you the decision was not based off of performance,” they said in a statement to employees, according to CNBC. “We will be continuing to run routes as normal to provide service to Amazon through July 18, 2020.”
IQDI driver Phillip Cullinane said that all of the approximately 80 employees at the company’s Salt Lake City location were laid off, adding that they had recently doubled the number of workers there to meet demand during the coronavirus pandemic, CNBC reported.