Amazon may cut 5,000 delivery jobs, close 15 warehouses in New York over labour law

Amazon’s delivery network in New York City could face a major shake-up if a proposed law requiring direct employment of contracted drivers becomes legislation. The company has reportedly warned it could shut 15 delivery facilities across the city and move thousands of jobs elsewhere, while logistics analysts believe it may be prepared to follow through rather than change its operating model.

The dispute centres on the Delivery Protection Act, a measure backed by New York City Mayor Zohran Mamdani. It seeks to change how major delivery companies engage workers, including Amazon, by requiring the retail giant to employ more than 5,000 drivers directly instead of relying on independent delivery contractors.

Supporters argue that the proposal would improve pay and strengthen workplace safety protections across the delivery industry. However, the potential consequences extend beyond drivers: a withdrawal by Amazon could affect warehouse employees and dozens of small businesses that depend on its delivery network.

Amazon’s Montreal retreat raises fears of a similar move

The prospect of closures has drawn attention to Amazon’s decision to leave the Montreal market in Canada last year. The company permanently shut seven warehouses in Quebec following a unionisation campaign at its Laval facility, led by the Confédération des syndicats nationaux (CSN).

The closures, completed by March 2025, resulted in approximately 1,900 warehouse jobs being lost. Amazon also ended contracts with around 2,800 third-party delivery drivers, according to the reported figures.

Marc Wulfraat, president and founder of logistics consultancy MWPVL International, believes the Canadian experience offers a warning about how Amazon could respond to pressure in New York.

He argued that the company may seek to discourage similar demands elsewhere by demonstrating the consequences of challenging its employment and logistics arrangements. Wulfraat also pointed to Amazon’s history of shutting facilities in response to union activity.

The Montreal operation has not disappeared from Amazon’s balance sheet entirely. The company reportedly continues to pay rent on more than 1.6 million square feet of unused commercial space, representing a substantial investment in facilities that are no longer operating. At least two of the properties have been offered for sublease.

Brittain Ladd, a former Amazon executive who now works as a logistics consultant, warned that the company could take a comparable approach in New York if it considers the proposed legislation a threat to its wider business model.

Ladd said Amazon could close all 15 of its last-mile facilities in the city rather than accept the new requirements, particularly if other municipalities were to consider similar laws.

Such an outcome remains a possibility rather than a confirmed decision. However, the Montreal closures have intensified concerns that Amazon could respond to regulation by relocating operations instead of restructuring its workforce.

Small delivery firms face an uncertain future

The immediate effects could be felt by the 40 independent delivery service partners responsible for employing New York City’s approximately 5,000 Amazon drivers. These businesses operate under contracts with the company and rely on its delivery volumes to sustain their operations.

Kris Basmagy, owner of DashWave Delivery, said his business employs 150 people delivering parcels across Manhattan’s Upper East Side. He views Amazon’s withdrawal from Montreal as evidence that the company could choose to move its distribution operations outside the city rather than accept the proposed changes.

Basmagy suggested that facilities being developed along the New Jersey Turnpike could provide alternative locations for distribution hubs, potentially allowing Amazon to continue serving the wider region without maintaining the same footprint within New York City.

For smaller contractors, however, a relocation could mean losing the business that supports their employees. Joe Artus, founder of WGA Transit, said his company employs 189 drivers in Harlem and recruits people who have experienced homelessness or previously served prison sentences.

Artus believes the legislation would leave his company unable to continue operating under its current arrangement. He said the consequences would extend to his employees and his young family, adding that he could see no viable way to retain the business if the bill passed.

Beyond the contracted workforce, closing all 15 facilities could also put approximately 2,000 Amazon warehouse employees at risk. Those workers staff the city’s last-mile stations, which handle the final stage of getting orders to customers.

The legislation’s supporters maintain that direct employment would strengthen protections for delivery workers. The central question is whether those benefits can be secured without prompting Amazon to relocate jobs and operations elsewhere. Until the proposal’s outcome becomes clearer, workers and contractors face uncertainty over whether the company will adapt its model or reduce its presence in the city.