The Amazon logo is displayed on a wooden podium with a city skyline in the background.
TRENTON, N.J. - The New Jersey Attorney General has sued Amazon.com, claiming that the retail giant is monopolizing its own delivery network to suppress wages for drivers.
The five-count complaint, which Davenport filed on Aug. 4 in a New Jersey federal court, alleges violations of both federal and New Jersey antitrust laws and is aimed at the way Amazon operates its Delivery Service Partners program, the network of independently owned delivery businesses that provide “last-mile” drivers for Amazon.
“Last-mile" drivers deliver the products ordered through Amazon from the delivery warehouse to customers’ doors. Under Amazon’s DSP program, the drivers are not Amazon employees but instead work for businesses that contract with Amazon to provide delivery services.
Amazon created its DSP program in 2018, which at the time had 180 DSPs. By 2024, the program grew rapidly to 4,400 DSPs in 19 countries. According to the complaint, it costs roughly $30,000 in assets and $10,000 in startup costs to launch a DSP, which compares favorably to the $300,000 to $1.5 million it allegedly costs to start an independent delivery business for FedEx.
In her complaint, Davenport describes Amazon’s DSP program like a franchise business: “DSPs commonly lease and utilize Amazon-branded trucks and vans, and the DSPs’ employees wear Amazon-branded clothing. Amazon imposes the terms and conditions for those leases… Amazon prohibits DSPs from using the vans for anything other than delivering Amazon packages… Similarly, employees wearing Amazon uniforms may deliver only Amazon packages.”
By controlling the details of how DSPs provide Amazon delivery services, including a requirement that DSPs enter into agreements not to hire drivers away from other DSPs, so-called “no-poach” agreements, the complaint alleges DSPs are deprived of “meaningful independence and fair compensation.”
But the real focus of the complaint is the alleged impact on wages paid to DSP drivers. “The complaint alleges that Amazon’s conduct causes thousands of New Jersey residents to earn lower wages and to endure harsher working conditions than they should,” according to the AG’s statement accompanying the complaint.
“Today, my office is acting to stand up for thousands of New Jersey delivery drivers who are being exploited every day by one of the world’s biggest, richest corporations,” Attorney General Davenport stated. “Amazon built a company worth trillions while subjecting drivers in its delivery network to artificially low pay and punishing working conditions thanks to its overwhelming power in the labor market.”
And while acknowledging that other employers like the U.S. Postal Service, FedEx and UPS also hire delivery drivers, the complaint downplays these alternative employers as realistic competition to Amazon, describing these jobs as “golden ticket” jobs. The complaint seems almost surprised that drivers “cannot simply decide to work for an alternative employer; the employer must be hiring when the driver is looking and must select the DSP driver.”
Buried among the antitrust jargon of “monopsony” and “relevant markets,” the complaint reveals its true intentions, which is to force Amazon to provide allegedly higher-paying union jobs. “Amazon uses a range of anticompetitive tactics, through its control over the DSPs, to crush any prospect of DSP worker unionization,” the AG complains.
The complaint described instances at two local delivery stations – one in Edison, N.J., and one in Queens, N.Y. – in which Amazon supposedly suppressed attempts by DSP drivers to unionize. “If drivers were permitted to unionize in the absence of Amazon’s conduct,” the complaint asserts, “wages would increase to a more competitive level.”
This complaint is not the only attack by the New Jersey AG’s office on the way Amazon compensates drivers. Last fall, then-AG Matthew Platkin and the New Jersey Department of Labor sued Amazon, claiming that the company misclassifies its “Flex” drivers as independent contractors and not employees. Unlike DSP drivers, Flex drivers are directly contracted by Amazon and use their own vehicles to deliver Amazon and Whole Foods orders.
Just this week in neighboring New York City, Mayor Zohran Mamdani threw his support behind the Delivery Protection Act, a bill introduced in the City Council earlier this year that would require operators of last-mile delivery warehouses, like Amazon, to directly employ all its drivers that deliver from warehouses located in New York City. The bill is also supported by the Teamsters union.
Working with Davenport’s office on the Amazon antitrust lawsuit is a Texas plaintiff’s firm, the Nachawati Law Group. According to its website, the firm has a Public Entity Litigation Division, which acts as a “force multiplier for government enforcers who need help protecting their citizens from corporate wrongdoing.”
In June, the firm boasted the hiring of Benjamin Notterman, who previously served as Senior Counsel to AGs Platkin and Davenport. Notterman is not listed as counsel of record on the complaint.
The New York and Washington, D.C., offices of Outten & Golden, a class-action employee-side plaintiff’s firm, are representing the New Jersey Attorney General in the Flex driver misclassification case.