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Logistics Firms Have Used the Pandemic to Boost Profits and Make Workers More Precarious

With millions of people ordering basic necessities direct to their homes, the pandemic has massively strengthened big distributors like FedEx and Amazon. But while official discourse celebrates delivery drivers as “heroes,” the logistics firms themselves have used the crisis to undermine workers’ most basic rights.

Workers prepare items for shipping at the Rhenus logistics center during the coronavirus crisis on April 16, 2020 in Grossbeeren, Germany. Sean Gallup / Getty

More than ever, the current health crisis highlights the “logisticization” of the world. From the outset, the pandemic followed the routes of global trade; it is part of a generation of viruses whose potential for harm owes not so much to new biological forms as to the accelerated modes of transmission and circulation. Traveling on living beings or objects, by trucks, buses, planes, or cargo ships, in markets, airports, and within metropolitan areas, COVID-19 fits into every pore (and port) of globalized economies. Leaving a viral imprint on the infrastructures of capitalism, it exacerbates and makes visible their noxiousness.

Capitalism’s fundamental dependence on global logistics infrastructures has triggered contradictory political reactions. At first, we saw a loud insistence on closing the borders — as if the pandemic were sensitive to nationalist reflexes. But the circuits of logistics quickly overcame these constraints. To get around the closure of the borders between France and Italy, for example, the flow of goods was diverted via Switzerland and Luxembourg — as we saw when we interviewed dockworkers. Logistics knows how to play with borders very well, as was also apparent in the changes in logistics circuits caused by the rise in oil prices. Despite the ecological cost, many cargo ships currently avoid the Suez Canal and prefer the long way around the Cape of Good Hope.

Very quickly, the transportation and warehousing industries appeared essential to the reproduction of the confined society, particularly in the food and health sectors. Logistics took advantage of this to claim the glorious status of “operator of vital importance.” France’s secretary of state for the digital economy, Cédric O, echoed Emmanuel Macron’s militaristic rhetoric by comparing the logistics sector to the “rear” that must “hold on” and push its employees to continue operating — brushing aside concerns about workplace health conditions. Worse, labor minister Muriel Pénicaud announced a removal of the upper limits on working time (twelve hours a day, sixty hours a week) in sectors considered “strategic,” including logistics. Such exemptions from the labor code worryingly extend the “state of emergency” to the world of business.

But in the current crisis, logistics is once again emerging as the Achilles’ heel of the globalized economy. From warehouse staff catapulted onto the “front line” to global supply chains that spread the virus, from cargo planes delivering masks from China to health scandals in distribution hubs, the logistics sector is today cast as both savior and culprit.

The Virus of Profit

From logistics firms’ perspective, their strategic importance in times of pandemic first appeared as a business opportunity. At the beginning of the crisis, retail chains benefited greatly from hoarding and the supply needs of confined populations, in France and elsewhere. Trade magazines presented the crisis as a windfall for the largest logistics companies, with warehouses and drive centers running “at full capacity” to supply supermarkets or deliver direct to consumers. The major retail firms have accelerated their conversion to e-commerce and home delivery. This included partnerships with the main meal delivery platforms (Uber Eats and Deliveroo), which could become the favorite model of consumption in a society under the grip of a constant health risk.

But logistics activities are highly sensitive to economic variations, and the sector then experienced a general slowdown owing to the cyclical change in consumption patterns during the confinement period. For instance, the leading logistics companies for fresh produce announced substantial losses. The STEF Group even attempted to offset them by increasing its prices by 8 percent, before having to withdraw under the pressure from competitors and customers. In the warehouses of Carrefour, France’s leading retail company, the volumes handled were 15 percent down in mid-April, and the average value of each parcel fell sharply as purchases shifted toward basic necessities. More than government measures, it is this reaction — one of necessity and caution, but which can be described as political — that has put the mass distribution sector in check.

On the whole, e-commerce also seems to be hit by falling levels of purchases. In the first surveys carried out at the end of March by the sector federation, three-quarters of companies announced a drop in volumes. Only e-commerce and delivery giants like Amazon, UPS, and FedEx are managing to maintain or expand their operations despite the crisis. Indeed, these logistics multinationals are recruiting in great numbers, seeking to attract workers from all over the world. In what also looks like a major communications operation, Amazon announced the hiring of 175,000 people in the United States in a mere two months. Investors understood this strong signal, as Amazon shares quickly rose to historic highs.

Despite the slowdown in activity linked to restaurant closures and layoffs, the urban logistics of “platform capitalism” could also be a big winner in the long term, extending its usual market share to other types of services and public-private partnerships. Uber Eats, Deliveroo, and other gig economy firms simply e-mail the delivery workers —now taking the risk on customers’ behalf — to remind them of the hygiene measures needed for a “contactless delivery” (which is, in fact, impossible). At the other end of the chain, user restaurants are offered lower commissions as an incentive to join the market.

In the United States, Uber and Lyft are seeking to take advantage of the transportation of vulnerable people and sanitary goods by developing specific applications (Uber Health and LyftUp) while DoorDash is partnering with New York City to deliver food to “medically vulnerable students.” Across the Atlantic, Deliveroo, JustEat, and Uber are reportedly in talks with the UK government to develop delivery services for the elderly and at risk.

Pharmaceutical logistics is also a major beneficiary of the health emergency. The huge current needs for these products are creating juicy public and private markets in which trade wars are underway between the major groups that control this market. Faced with the shortage of masks in particular, the French government has turned to these multinationals’ tentacular subcontracting networks, hoping to make up for its own belated reaction. First relying on pharmaceutical logistics groups, such as the European leader EHDH, it then turned — albeit rather chaotically — to the privatized subsidiaries of publicly owned groups and in particular to Geodis, the logistics subsidiary of national rail company SNCF. Promoted in the media as a “miracle solution,” the implementation of an “air bridge” with China — meaning, Antonov cargo planes at a cost of €1 million per flight — looks more like a rush to embrace the very mechanisms that were at the root of the crisis.

In each sub-segment of the sector, a new phase of concentration of activities and profits in the hands of a few large players seems to be emerging. As after the 2008 financial crisis, we could see a cascade of bankruptcies among the myriad of small transport subcontractors on which multinationals rely. This would be followed by massive takeovers by large companies, with restructuring, waves of layoffs, and a general intensification of work. The price of the crisis would ultimately be paid by the workers in the sector, in the form of tougher exploitation regimes.

Precarious Workers

The capitalist management of the pandemic highlights the centrality of an entire segment of the working class whose wages are inversely proportional to their social utility. On one end of the logistics chain are cashiers: in charge of ensuring continued sales, they are, along with the delivery workers, among the most exposed to contagion. But in France, the “front line” — as media and politicians call it — is also made up of some 800,000 logistics workers, most of whom work in warehouses on the outskirts of large urban areas. More than 80 percent of these workers are men, most of them from racialized minorities. Counting the 550,000 road workers who work in the transport of goods (in trucks, vans, motor scooters, or bicycles), more than 1.3 million people work daily in the circulation of goods — i.e., more than 25 percent of the blue-collar workers in France today, as against just 16 percent in the 1980s.

The logistics sector has long been marked by job insecurity and a space for experimentation with atypical forms of employment and circumvention of labor codes. While the workforce in the warehouses is sometimes predominantly temporary, those working on the road increasingly have a self-employed status (as craftsman, taxi driver, auto-delivery contractor) or count as a posted worker. Over the last ten years, there has been a growing use of various forms of downgraded permanent contracts, such as employer alliances, business structures that allow companies to share employees, and, since the beginning of the epidemic, the launch of a platform for sharing employees through subleasing.

The health crisis highlights and exacerbates these workers’ conditions. To ensure business continuity, and especially to replace employees who are sick or off on precaution, multinational logistics companies are trying to attract the workforce made available by the decline in activity in other sectors. Temporary employment agencies in large urban areas are facing an upsurge in demand for Amazon logistics hubs and multinationals in the parcel delivery sector. Similarly, meal delivery platforms rely heavily on migrant labor, renting accounts from third parties, who have no access to the meager exceptional financial support from the state and who therefore have no choice but to continue working.

For temporary logistics workers, who often work without protection, the “right of withdrawal” is only theoretical. Rather, they are urged not to conceal any physical weaknesses in order not to be squeezed out of recruitment networks. In addition to an inherently difficult and pathogenic job, they are also exposed to the fear of contagion, either by moving from one workplace to another or by handling objects through which the virus may pass. It is this cascading spread of the risk of contamination that led to the death of a temporary worker infected with COVID-19 in the FedEx warehouse and that of a temporary worker working as a ramp agent at Charles de Gaulle Airport. Until March 15, this latter was unloading “cargo ships coming from China, up to 5 per day, without gloves, without mask, without protection.” On April 2, several temporary employment agencies withdrew their employees from the FedEx site following a warning from the labor inspectorate. A temporary worker summed up the dilemma faced by these precarious workers: “either you have COVID or you starve to death.”

Conversely, for companies experiencing a slowdown in their activity, temporary employment has made it possible to fire a large part of their workforce at no cost. Hired on weekly contracts, tens of thousands of workers are not covered by short-time working measures and have to cope with benefits eroded by the successive reforms of unemployment insurance. However, stable employees are not being spared: in a sector where productivity bonuses and overtime can represent up to a quarter of their wage, the transition to short-time work often results in a loss of €500 per month.

Resistance

This precarious position is a magnifying glass on ordinary conditions throughout the sector. In many warehouses, basic sanitary rules are not respected — especially in times of pandemic, with the lack of masks, gloves, and sanitizing gel. Parcels come from everywhere and circulate from hand to hand, as do work tools. Some heavy loads require several people to work together, and on sorting lines, the work is done in close proximity. In the EHDH pharmaceutical logistics group’s subsidiaries, for example, the lack of personal protective equipment (PPE_ is critical, while packages full of masks flow along the docks. At Eurotranspharma, the cases are multiplying, and it is only as a result of disruptions and pressure from the union staff that a complete cleaning of the premises and lorries was carried out, and that management provided masks and gel in sufficient quantities.

The evidence from the warehouses shows that, in many cases, it is the employees who implement the individual and collective means to protect themselves (and us). In workplaces where unions are strongly established, workers’ representatives are often the first to gauge the threat. Those who are used to handling packages from China and around the world realized very early on that the virus was much closer than we thought — and that they were already exposed. Before confinement measures were implemented, with the media portraying the virus as distant, they had already sounded the alarm by calling emergency meetings with management. Hailing from the poor and racialized banlieues, these workers are the same people who mainstream media and many politicians systematically accuse of “uncivil behavior.”

In several warehouses, workers on permanent contracts have undertaken to distribute the sanitary equipment to the temporary workers. At the Geodis warehouse in Gennevilliers, no protective equipment was provided at the beginning of the crisis, forcing trade-union staff to organize the distribution of masks, using stocks built up to protect against tear gas during strikes. To top it off, the company won one of the main contracts for transporting FFP2 masks paid for by the French state. It was not until March 17, when an employee suffered a respiratory ailment on a loading dock, tested positive for COVID-19, and was hospitalized for a week in a serious condition, that management took real action. Under union pressure, this platform, which does not deliver any basic necessities, was finally slowed down, as the employees were able to exercise their right to short-time working.

Normally, when these workers are required to damage their health, they do so to provide for themselves and their families. But with the pandemic, the contradiction between health and profits is pushed to the limit. Many employees say that they go to work with a “lump in their stomach” and return home anxious that they might contaminate those with whom they live, sometimes elderly people. In the absence of union structures to control protection levels — as across the vast majority of the sector — various forms of work avoidance or refusal have multiplied. Absenteeism has skyrocketed, exceeding 50 percent on some sites. In many companies, there is a stark contrast with the managers teleworking and sending their encouragement to teams by email.

Faced with the hazards for workers, the French government “invites” companies to pay a tax-free bonus for staff (at their own discretion) on the same model as the one proposed in response to the gilets jaunes movement. This random bonus policy appears to be the government’s only response to job insecurity.  Several local unions have already refused the derisory compensation offered to them in exchange for a deadly risk. In pharmaceutical logistics groups such as EHDH, the payment is just €100 — and conditioned on being continuously present. Those who have had to take a day off to look after children or assist parents are left out. A rare event: in Clermont-Ferrand, eighty temporary workers from an Auchan platform, supported by 200 employees, walked off the job when the site director announced that there would be no bonus for them.

In any case, to achieve a sufficient level of protection would require a profound transformation of the organization of work — something unthinkable for employers, even in times of health crisis. In most logistics sites, only closure or a drastic reduction in volumes processed can really protect employees. To maintain production levels, management relies on the uncertainty resulting from the lack of testing. When symptoms appear, workers’ response is individualized — either withdrawing by themselves or being sent home without informing the rest of the work crew.

Many union leaders explain that they have to carry out investigations to identify risks. Only when put under pressure does management finally react, fearing media scandals or legal attacks. Most notably in France, Amazon’s management was forced to acknowledge its unpreparedness and the many gaps in the implementation of protection measures. Employee testimony confirmed that they were in real danger, particularly at the warehouse in Brétigny-sur-Orge, where at the beginning of April there were four proven cases of COVID-19 — leaving one person in a coma. On an amateur video montage, we can see employees massed at the entrance of the warehouse after having taken crowded public transport.

On April 14, a court decision might have suggested that the current health tragedy was being properly dealt with. The Nanterre court ordered Amazon to implement protective measures for its employees and to limit its activity to essential products only. Two days later, the multinational company announced the closure of its main French warehouses until May 18. If the news is surprising, it should first be recalled that Amazon doesn’t represent the whole logistics sector — thousands of warehouses remain open. Indeed, Amazon serves as an easy media target that makes invisible what goes on into other companies. Amazon was quick to retaliate by announcing that its deliveries would be maintained. It can rely both on its warehouses abroad — as it already does in response to strikes — and on the sprawling subcontracting network it already uses in normal times. Well known for always being at the forefront of innovation in the field of worker exploitation, the multinational company is now inventing health dumping in the midst of a pandemic.

What Is “Essential”?

The question of what is or isn’t essential underlines the different exposure to risk that different categories of workers face. Many governments have insisted that production should be limited to “essential” activities only. But this limitation is eminently political. In Italy, where spontaneous or organized strikes have taken place in many northern warehouses to demand safety measures, the list of essential sectors published on March 22 included the entire logistics sector — no matter whether it is food or branded shoes. Similarly, in France, supermarkets remain open and continue to sell household appliances or high-tech equipment, activating the entire logistics chain upstream for the supply of these products. To reduce activity, however, it would simply be enough to deactivate a line of code in management software, the “non-food” checkbox, for example, as large groups already do in reaction to major strikes.

Once again, Amazon has given rise to a whole drama performance of state and justice bearing down on a recalcitrant company. From the first moments of confinement, Amazon played on ambiguity by promising to limit its activity to only “food and household goods,” a category made up from scratch and stretchable at will. Following the lawsuit filed by the SUD-Commerce union, the Nanterre court ordered Amazon to limit its activity to “the preparation and shipping of orders for food products, hygiene products and medical products.” While this decision was upheld on appeal, in an unprecedented ruling, the Versailles court nevertheless extended the list of products concerned, adding high-tech and computer equipment, considering them to be “indispensable for teleworking.” Thus, the workers have to work at risk so that the executives can work with protection, a kind of (capitalist) snake biting its own tail.

These contradictions reveal how far large companies put production before the health of employees and their families. But they are in line with the government, which has adopted a martial language of protection and national unity while also rapidly pivoting to the “economic war” that still needs fighting. The top managers of the major logistics groups do not hesitate to use this unconditional support, explaining to workers’ representatives that the state is forcing them to continue their activity, as we have heard from Amazon, Geodis, and EHDH. The implication of this discourse is clear: you cannot protect everyone, and you have to make sacrifices for the economy. The fact that employees in the metalwork and logistics sectors have mobilized in Italy under the slogan “we’re not cannon fodder” clearly shows their full awareness of the hypocrisy of these calls to maintain production.

It is therefore to modes of production — and not to modes of consumption — that we must focus our thinking on what is essential and what is not. The media denunciations of orders for sex toys or nail polish are a good example of the ambiguity of this discourse. They carry an obvious moral charge, oriented toward femininity and sexuality, under the pretext of protecting people. In reality, it is only when a power struggle is launched within (or at least directed at) the company that limitations in production and circulation can be conquered — in other words, by targeting not consumer habits but the productive organization as a whole. The case of Lombardy shows us how fundamental these struggles are, since we know today that the region is hard hit because of the density of its industrial and urban fabric . . . and because factories have closed too late or continue to operate.

Hand-to-Hand Combat

While global supply chains can be blamed for their role in the pandemic’s spread, they are paradoxically brandished as lifesavers in times of containment. These life buoys are sometimes useless, considering the difficulty Western economies have in getting enough masks from Asia. There is little chance that these “logistical gaps” — as identified by Emmanuel Macron himself — will be resolved after the crisis, and there is reason to fear the next phase of concentration restructuring in the sector, of the kind that has been undermining organization and work at every levels of the logistics chain for over forty years, from the warehouse worker to the delivery cyclist.

From the company to the state and international level, what is most obvious is the inability of capitalist institutions to manage the health crisis. The world of management and its governmental avatars do not have, in their systems of thought, the right tools for a situation that first and foremost is about preserving our bodies themselves. In warehouses, the virus is added to lumbago, musculoskeletal disorders, and other pathologies of the job task repeated ad infinitum. Sometimes it is cumulative, as in the case of comorbidity factors — such as heart and lung failure or diabetes — that are known to affect the working classes more frequently, precisely because of poor working and living conditions.

In these gigantic failures, one must underline above all the salutary role played by the work collectives that have managed to take control of the situation. In some cases, union activists can be considered to have taken over the sanitary management of the warehouses, ensuring the distribution of protective equipment and monitoring the implementation of sanitary measures. This expression of an autonomous power in the factory also recalls what has been observed in hospitals, with medical teams substituting for outdated management. When this power cannot be expressed, due to a lack of collective organization, the forms of work avoidance or refusal, whether through unemployment or work interruptions, are just as decisive and vital in the pandemic environment.

Contrary to the innuendos of media and political discourse on the “front lines” — which equates service workers with soldiers, unwilling victims of a war they have suffered — many labor collectives have thus been and still are central to resisting the virus. They have, therefore, relied on forms of solidarity and mutual aid and on a social power that preexisted the crisis but was reinforced by it. Through their positions in the productive and reproductive process, at the heart of the flow of parcels or sick people, they anticipated what the governments themselves did not want to see.

In the continuation of the movement against Macron’s pension reform, working-class people are again refusing to sacrifice their health on the altar of keeping up economic growth. It suggests an opening up of possibilities in the struggles to come, oriented against one of the main ravages of capitalism — that which directly affects our bodies and life itself.