Who pays for Amazon’s “customer obsession”? The service reps who pick up the phones.

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Filipino employees take calls from the US in a call center in Manila, Philippines, in 2011. Dondi Tawatao/Getty Images

Call center employees at an Amazon subcontractor in the Philippines report 24-hour shifts and flouted safety regulations.

As the sun sets in the Philippines, more than a million Filipinos are just beginning to wake up for work. If you’re one of Amazon Prime’s 100 million subscribers in the United States, you may have spoken with them as they worked the graveyard shift, during which an agent can field up to 100 customer service and technical support calls and text chats. Jeff Bezos, Amazon’s founder and chief executive, credits the company’s growth and retention to “customer obsession,” part of which is speedy and painless customer service. But in order to meet Amazon’s 24/7 customer service demands, some agents say shifts as long as 16 to 24 hours are sometimes the norm.

Long hours are standard in the call center industry, which has generated $23.8 billion for the Philippine economy since the 1990s. After welcoming call centers with lax regulation and a 0 percent corporate tax holiday, the Philippine government is now playing catch-up to protect workers from excessive overtime, job insecurity, and the deadly consequences of an industry that largely escaped oversight for more than 20 years.

Call center agents say they work long hours and adhere to strict turnaround times for Amazon

A call center in northern Manila operated by Concentrix, an Amazon contractor based in California, hosts 500 agents working exclusively on the Amazon account. They repeatedly say, “Thank you for calling Amazon. How may I help you today?” Often a pleasant customer will be on the line, but sometimes, an angry one might berate an unsuspecting agent.

Regardless of a customer’s mood, the agents have less than 10 minutes to resolve their concerns (reports on the allotted time vary; employees claim to be limited to seven minutes, while Amazon has given answers ranging from eight and a half to 10 minutes). That average handling time is based on Concentrix and Amazon’s contract, according to interviews with two dozen agents. Former managers told Vox that Amazon fines the call center $2.85 per failed call, an incentive for managers to push overloaded agents.


AGENTS HAVE LESS THAN 10 MINUTES TO RESOLVE CUSTOMER CONCERNS


Managers across the industry said the contractual penalty is standard among customer service accounts. Clients typically send a daily call volume forecast so that a call center can ensure it has enough personnel to handle the workload. But even though Concentrix has at least four sites in the Philippines on the Amazon account, handling the sheer number of calls is still a daily struggle, especially on special events like Amazon’s annual Prime Day, a two-day sale in mid-July. Last year, the company boasted more than 100 million products sold on Prime Day, raking in an estimated $4 billion, according to an industry analyst.

“The schedule, it’s given that we’re 24/7, especially if there are sales in the US,” said Ronnie Cruz, a Concentrix employee formerly on the Amazon account, about the round-the-clock operation in call centers.

But even beyond sale events, “24-hour shifts were normal in Amazon,” said Carla, a Concentrix team manager who worked on the Amazon account for three years. She asked for her name to be changed due to her confidentiality agreement with Concentrix. “But it’s not normal” on other accounts, she added.

Concentrix denies this claim. “We don’t ask anyone to work 24-hour shifts,” said Jyllene Miller, executive vice president for marketing and emerging business at Concentrix. “You don’t run a business our size or any of our clients’ size when you treat staff that way.”

Call centers are huge business for the Philippines — and regulations are lax

Concentrix is now the largest private employer in the Philippines, employing 65,000 Filipinos in Metro Manila alone, and 80,000 in total nationwide. Amazon and other American companies save up to 80 percent of what they would have spent in the United States by outsourcing hundreds of thousands of customer service and technical support jobs to countries like the Philippines and India, according to the Information Technology and Business Processing Association of the Philippines (IBPAP), the local call center association.

On average, call centers offered about $100 USD more than the monthly minimum wage of $286, attracting educated yet underemployed Filipinos despite notoriously long night shifts.

While employment contracts follow local labor laws on paper, interviews with agents and team leaders revealed how call centers get around overtime rules. Contracts require employees to render overtime work based on “business needs,” a vague term that leaves hours to managers’ discretion.

Grace Manalo, a former Concentrix team leader for Amazon, said she sometimes worked 24 hours straight to produce post-shift reports and performance assessments. “The time period allotted for deliverables was very sadistic,” she said. Manalo worked on the Amazon account for five years and has pursued labor arbitration since she was fired for gross neglect by Concentrix in 2017, after missing a payroll deadline due to illness.

Call center employees in 2011.

Team leaders like Manalo had to supervise employees’ paid overtime work, but their own overtime pay extended only to two hours, despite working twice their regular nine-hour shifts.

In a statement, Amazon denied the allegations: “The vendors we hire to help provide customer service on our behalf are required to adhere to our policies, which include compliance with labor laws, a comfortable work environment, and competitive wages.”

“I felt abused as a team manager,” Carla said. “My husband was so mad because I worked 15 hours every day, sometimes for 15 days straight without a day off.” Pinlac, a mother of one in her 30s, believes she developed angina, a heart condition, because of her Amazon work schedule.

“These are very young workers, but they’re prone to lung cancer, high blood pressure, and stroke,” said Paul Pinlac, a former call center physician who now teaches at the University of the Philippines College of Public Health.

A set of bills before the Philippine House of Representatives addressing call center workers’ welfare categorizes night shift work as hazardous, and raises the night-shift premium from 10 percent to 25 percent of basic pay.

At a House committee hearing held last October, the call center industry association urged lawmakers to consider the economic effects of raising the night shift premium.

Government officials have been hesitant to regulate call centers — with deadly consequences

The Philippine labor department has historically struggled to regulate call centers, in part because of the industry’s particular needs, such as contractual work and graveyard shifts. “At the end of the day, we don’t want overregulation,” Nicki Agcaoili, the industry association’s president, said in a phone interview.

“They should be policing themselves, that’s what IBPAP says,” said Teresita S. Cucueco, director of the working conditions bureau, the government agency responsible for labor inspections. “But then sometimes, there’s an attitude that they’re the goose that lays the golden eggs because of the employment generated.”“


THERE’S AN ATTITUDE THAT [CALL CENTERS ARE] THE GOOSE THAT LAYS THE GOLDEN EGGS”


Finding annual inspections burdensome, in 2016 the call center industry lobbied the government for an incentive to stay compliant: a certificate guaranteeing no further inspections for two years if they passed a first inspection.

This exact exemption allowed a call center in Davao City in the southern Philippines to avoid inspections for nearly two years. In 2017, 38 employees died in a fire after being trapped in the call center for half an hour. The company, Survey Sampling International, now known as Dynata, declined to comment.

At Concentrix, accounts like Amazon that have the phones constantly ringing were excluded from emergency drills, or only a few agents at a time would be allowed to participate so as not to disrupt workflow, according to employees. “You don’t leave your station. They just talk you through it,” said Gloria Jane Palima, a former team leader who worked on Amazon support. “You have to duck and hold while on the phone with a customer,” she said about earthquake drills.

Concentrix denied the allegation, pointing to the company’s occupational safety and health certifications. “We have never been asked by clients not to have our staff participate in drills,” Miller said.

The call center industry in the Philippines fears being undercut by cheaper labor abroad

Synnex, the parent company of Concentrix, has publicly expressed concern about high employee turnover in the call center business. “Such disruption may impact our ability to manage our costs, which in turn could impact our profitability,” Synnex wrote in its most recent annual report.

While companies worry about competition within the industry, the Philippines is fending off cheaper labor in India and Vietnam, and agents in urban centers fear wage depression because of new call centers in the countryside.


CONCENTRIX ANNOUNCED A SECOND-QUARTER PROFIT OF $62 MILLION


“In the provinces, we’ve heard of some cases of 6,000 pesos per month,” said Rico Hababag, secretary general of BIEN, a fledgling national call center workers union. That’s little more than $100, 72 percent less than the average annual salary for call center agents in Manila, and 96 percent cheaper than the average salary at an American call center.

Concentrix announced a second-quarter profit of $62 million. The stock price of its parent company, Synnex, has risen approximately 125 percent since the end of 2018. In Manila, long lines continue to wrap around call center recruitment offices.

Sarah Prestoza, the leader of an agents union at Alorica, one of Concentrix’s competitors, said call centers have no incentive to change because the salary will continue to attract workers.

“The salary is not worth it, even though it’s higher than the minimum wage,” Prestoza said to Vox last year at a memorial for the victims of the 2017 call center fire. “Hospital and funeral bills are more expensive.”

Reporting for this story was supported by the Toni Stabile Center for Investigative Journalism at Columbia University.

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Reference Link:
https://www.vox.com/the-goods/2019/7/22/20691918/amazon-customer-service-call-center-philippines