SYDNEY – Australia’s New South Wales state ordered employers of freelance delivery drivers, such as Amazon.com Inc, to pay a minimum wage, a decision heralded by a union as the world’s first to require the retailer to observe such legislation.

The law, which goes into effect on March 1 and will be phased in over three years, mandates enterprises who hire drivers with their own small cars to pay a minimum of A$37.80 ($27.20) per hour in Australia’s most populous state.

According to the Transport Workers’ Union (TWU), this makes the state, the hub of Amazon’s activities in Australia, the first site where the ecommerce giant must pay legal salaries to contractors.

“This is what happens when workers call out these dangerous bottom feeders and fight together for a decent day’s wage,” said Michael Kaine, the union’s national secretary.

“For far too long, companies like Amazon have been allowed to use independent contractor loopholes to skirt rights and rob employees of fair wages,” he said in a statement.

According to an Amazon representative, the business is “pleased to continue giving Amazon Flex delivery partners competitive pay as well as the freedom to work when it is convenient for them.”

Flex drivers in New South Wales already earned more than the enforceable rate that would take effect on March 1, according to the spokeswoman.

According to the New South Wales Industrial Relations Commission judgement, which was seen by Reuters, the minimum wage ruling applies to all enterprises that engage casual delivery drivers with cars weighing less than two tonnes. According to the union, Amazon is the state’s largest employer of small vehicle drivers, employing thousands of contractors.

The $1.6 trillion company’s stock has virtually quadrupled in value over the last two years, as the COVID-19 outbreak triggered a rush to online buying.

However, it has come under fire for what seems to be a hands-off approach to front-line worker safety and labour regulations in the nations where it operates.

Last year, the US Federal Trade Commission ordered Amazon to pay $61.7 million to repay Flex drivers for tips that were allegedly stolen.

Drivers who use their own cars to transport products picked up from Amazon distribution centres by deadline have received varied sums determined by the firm since Flex started in Australia in 2020, despite the fact that they are not legally employees.

The New South Wales Industrial Relations Commission’s decision on Friday underlines that all employees, regardless of employment status, can have access to enforceable rights and safeguards, according to the TWU.

“Having considered the parties’ representations and evidence, I am persuaded that the adjustments proposed…would result in fair and reasonable circumstances for the contract carriers to whom they apply,” concluded commissioner Damian Sloan in his judgement.

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