Amazon secures NLRB victory over joint employer status with DSPs

Amazon has secured a decisive legal victory regarding its employment relationship with Direct Service Providers (DSPs) after an NLRB administrative law judge approved a settlement agreement that explicitly disclaims joint employer status. The ruling by Judge G. Rebekah Ramirez resolves a complaint filed in September 2024 concerning the DSP Battle Tested Strategies (BTS) at the DAX8 facility in Palmdale, California, where workers had voted to unionise.

Under the terms of the settlement, Amazon will pay approximately $250,000 to 84 former BTS employees for the period between April and June 2023. The agreement includes a non-admission clause that specifically disavows Amazon’s status as a joint employer, a distinction that was central to the legal dispute. The payout is calculated based on two weeks’ pay for drivers and dispatchers employed as of May 2023, a date the union alleges coincided with Amazon reducing BTS routes following union recognition.

The dispute originated from an NLRB complaint alleging that Amazon and BTS were joint employers, which would have legally compelled Amazon to bargain with the Teamsters union. Judge Ramirez, in her review of the proceedings, noted significant gaps in the union’s case and found the settlement reasonable under the precedent set in Independent Stave. She rejected the Teamsters’ claims that the settlement was defective, allowing the agreement to proceed despite strong opposition.

Amazon stated that the contract with BTS was terminated in June 2023 due to repeated safety violations, including the use of vehicles with faulty brakes and failures to pay insurance providers. The company denied that the termination was retaliatory against the unionisation effort. In a statement, an Amazon spokesman emphasised that none of the Teamsters’ claims were found to be true and expressed satisfaction at concluding the matter to focus on supporting its partners and communities.

Despite the judge’s approval, the Teamsters union has formally requested to appeal the decision, describing the settlement as a “defective unilateral settlement” that undermines the National Labor Relations Act. The union argues that the deal jeopardises the rights of employees nationwide by allowing employers to violate the Act with impunity. Additionally, Johnathon Ervin, the owner of BTS, expressed opposition to the settlement in correspondence with the NLRB, despite having previously signed off on the union recognition.