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23.08.2022 08:00

The master of the web

Amazon Web Services is starting operations in Finland, which fuels speculation about whether Amazon’s e-commerce branch is on its way as well.

The technology company Amazon has announced its plans to launch an Amazon Web Services cloud services centre in Helsinki in the coming two years.

It will become one of Amazon’s Local Zones, which provides services for computation, databases and data storage near population and business centres. Thirty-one of these centres are built around the world, including in Copenhagen and Oslo.

Amazon’s online retailing is not coming to Finland yet, but there has been speculation about it many times already. In Sweden the AWS-centre was built in 2018 – a few years before the retail operation was launched there.

Outsourced warehouse in Eskilstuna

Amazon opened its online retail operation in Sweden in autumn 2020. Thomas Holm, a collective bargaining specialist at the Swedish Commercial Employees’ Union Handels says the union was ready to negotiate a collective agreement with Amazon as the company set up business in the country.

But before launching its operations, Amazon decided to outsource its entire warehouse in Eskilstuna to the transport and logistics firm Kuehne + Nagel, which negotiates its collective agreement with the transport workers’ union in Sweden. The union official David Eriksson says cooperation with Kuehne + Nagel has been smooth. The company runs the warehouse, with Amazon as its customer, and it follows the rules of the Swedish labour market.

White collar workers are directly on Amazons payroll in Sweden. Unionen – Swedens largest private sector and white-collar union – has members employed by Amazon. But Unionen does not provide further information on their numbers.

“My understanding is that their unionisation rate is low”, says Holm.

PAM’s Advisor for International Affairs Mari Taivainen says Amazons workers have had problems especially in countries in the global south, where the trade union movement is not particularly strong, but in Germany for example, the company has faced the effects of unionising.

” I think one reason Amazon hasn’t come to Finland sooner, could be the strong Nordic culture of broad agreements, of strong institutions, and the traditions of tripartite cooperation and social dialogue. The company would have to take a rather different approach here, than in countries with weak unions”, says Taivainen.

Problems in Europe as well

At the beginning of the year Amazon had 1.6 million workers, of which 1.5 million in the US. The company’s poor treatment of workers has made headlines all around the world, including in Europe.

According to Amnesty International’s 2020 study, Amazon has made it more difficult for workers to unionise and engage in collective bargaining. The company has also encumbered union activities in, for example, Great Britain and Poland.

The drawbacks of Amazon’s operations got workers, non-governmental organisations, and unions to launch a global Make Amazon Pay protest. Their demand is for Amazon to be made accountable for issues related to society, workers, taxation, and the environment.

Finland and Amazon

The opening of Amazon Web Service in Helsinki brings work to Finland, and the possible launch of e-commerce would further increase the staff considerably.

PAM’s collective bargaining Specialist Sirpa Leppäkangas thinks Amazon’s arrival could increase platform work the way it did in food delivery. On the other hand, the Norwegian online food store Oda has shown that the opposite is possible.

“There efficiency has come from automation, and drivers have normal employment contracts.”

Leppäkangas contemplates, that it can be hard to know beforehand what arrival the online retailer would mean for workers. Amazon would still have to take into consideration the labour market system and the cultural and political landscape. She draws parallels to when Lidl came to Finland.

” People wondered whether the union is welcome to the workplace, but now there is nothing special about that, and Lidl is the same kind of partner for us as any other company.”

Finnish labour markets are not virgin territory for Amazon, because in addition to workers being organised, so are the employers. Leppäkangas believes the Finnish Commerce also hopes Amazon would organise in the employer’s federation.

Senior researcher Lasse Mitronen of Aalto University sees positive sides to Amazon coming to Finland, but also sees clashes between Finnish and Amazon work cultures, if the company ends up commissioning atypical work that does not ensure a living.

“It could bring something we are not used to here, or that there isn’t regulation for, as Wolt and Uber have done. It’s a part of the changing work life and a big question for society at large.  If social security fees are left to the worker guised as entrepreneur, then does it undermine the social welfare model?”

Collective agreements bind tech giants as well

Even though the full-scale launch of Amazon’s web store in Finland would in many ways disrupt online retailing, the change would be moderate from a worker’s point of view. Most of the sectors would be covered by collective agreements thanks to their general applicability, reminds Leppäkangas.

” Amazon for example could not have a vote on whether there should be a shop steward or not at the workplace. It’s settled in the collective agreement. The other issue is then, what would happen if the regulatory framework would change.”

Leppäkangas is also concerned about Amazon crowding out companies that are good to workers, follow best practices of good leadership and promote workers well-being.

This is a shorter version of the original article in Finnish.