Is Amazon failing at technology?

By: Grace Gillis & CJ Rosenbaum

Amazon employees are wrongly being fired for taking medical time off and Amazon is struggling to fix its issues. The main issues are in the training of HR and line managers combined with technology software being unable to function the way Amazon needs it to.


Amazon’s Troubles Hold Lessons on HR Tech, Employee Experience

As reported by SHRM 1 on November 8, 2021, Amazon has recently had trouble giving their employees leave and accurately delivering pay and benefits. This may be a sign that their unique human resources department may begin to use more technology that will put customer needs before employee needs. The combination of a bad HR system and little care for their workers can cause Amazon employees who took personal or medical leave to be denied proper pay and sometimes even be wrongly terminated. During a time when companies cannot afford to lose employees, experts say that a lack of attention to HR technology and failure to ensure line managers and HR staff are properly trained and educated on the leave policies can have devastating effects on company performance.


The extent of the issue 

For around two years Amazon has been incorrectly calculating pay for employees on paid parental or medical leave with also withholding disability from other employees. Even more alarming was the number of Amazon employees who were wrongly fired due to the flaws in the time and attendance software programs. Workers across the country facing medical problems and other life crises have been fired when attendance software mistakenly marked them as no-shows, the Times reported. Amazon’s leave management system was run on a patchwork of programs that often didn’t speak to one another, the article revealed.


Other reasons for Amazon’s failing HR department 

HR technology analysts say that while combining multiple systems is not easy, Amazon should have had little trouble with the task, based on technology. “I can’t imagine a company that runs Amazon Web Services, distributes millions of packages every day and that can tell people within minutes when a package will appear at their door can’t effectively connect its internal HR systems,” said Josh Bersin, a global HR industry analyst and dean of the Josh Bersin Academy in Oakland, California. Bersin believes that the problems are more likely to be related to the corporate culture than to technology. “It appears from the Times story that management just wasn’t paying attention to employee needs,” he said. “It’s as much about creating a culture that values the employee experience as it is about integrating different technologies,” Bersin said he often talks to large companies that have solved similar problems and even some that have recently acquired other organizations into their own patchwork of HR systems. “Large companies that go through mergers or acquisitions are always upgrading, fixing, and integrating HR systems,” Bersin said. “But most that I talk to have come to the conclusion that if they don’t do a good job of it, it will affect the organization in a very negative way. Employees will be unhappy, there will be productivity issues, and you’ll have challenges around retaining and recruiting people.”


Expert Opinion

HR technology experts say that the kind of system integration that is required for Amazon to repair its technological issues is more achievable today due to the improvements in the quality of application programming interference (APIs) that connect disparate technologies. “With modern API technology available, HRIS, time and attendance, and leave management systems can be well and robustly integrated,” said Holger Mueller, vice president and principal analyst specializing in human capital management (HCM) technologies with Constellation Research, a technology research and advisory firm in Monte Vista, California. “Enterprises need to realize, though, that they own the integration and monitor it accordingly.” Ron Hanscome, a research vice president specializing in HCM applications with Gartner, said that Amazon’s lack of integration between core HR and third-party leave management systems can be the reason for the inaccurate pay data, wasted time and money, and longer cycle times leading to angered employees and HR administrators. System integration challenges are considered whether leave is administered in-house or external vendors are used.

The Times reported that while Amazon once outsourced management of its leave programs, it had “brought the effort in-house when providers couldn’t keep up with its growth.” Hanscome believes that HR leaders need to closely weigh the pros and cons of outsourcing leave management to third-party technology providers. “Pros include putting these processes in the hands of domain experts who do this all day, every day and improved process accuracy and standardization due to involving a third party with rigor in its processes and controls,” Hanscome said. The cons of outsourcing can be a greater cost, needing to shift resources to vendor management, and ongoing attention to keeping integrations current between core HR and the leave solution.

Other experts believe that the challenge of integrating different HR technologies to administer employee leaves can be underestimated even with the improvements that have been made technologically. “The reality of integrating systems so they can effectively talk to each other can be harder than it appears,” said Rich Fuerstenberg, a senior partner with research and advisory firm Mercer. There is a lack of seamless connection between HRIS, payroll, time, and attendance that external leave systems can create more issues.” Hourly workers
might need to take a few hours off here or there to get a vaccine or to help a family member, and that can be tricky for technology to track,” he said. “It’s a challenge to keep everything in sync for short intervals of time between, for
example, an external vendors leave system and internal HR technology.”


Possible solutions

Amazon is being proactive in their attempts to fix their leave program problems. An Amazon spokesperson said that a bridge is scheduled to be completed in march for the leave programs that will include incremental improvements in the meantime.” Also saying that Amazon is increasing the training for HR staff and line managers on the complexities of managing leave and on being more empathetic with workers.