NEW YORK—New York City Mayor Zohran Mamdani backed legislation that would mandate employment status for delivery workers, a direct challenge to the gig-economy model that underpins urban logistics. The bill targets companies like Amazon, which relies heavily on independent contractors for last-mile delivery within the city. Amazon shares closed down 2.1 percent at $272.27 as investors priced in higher labor expenses.
Converting contractors to full-time employees would force Amazon to absorb comprehensive benefits, employer-side payroll taxes and guaranteed overtime pay. Analysts estimate gig-economy companies save 20 to 30 percent on labor costs by using contractors rather than employees. A reclassification mandate could compel Amazon to restructure its entire delivery network across the five boroughs, with knock-on effects on delivery speed and pricing.
New York City could set a precedent that spreads to other major metropolitan areas, creating a patchwork of local labor regulations that complicates national logistics strategies for e-commerce and food delivery platforms. The regulatory risk extends well beyond Amazon to any platform reliant on contract labor.
The City Council is expected to debate the bill in the coming weeks, with a vote possible before year-end. If the bill passes, Amazon must either adapt its labor model or absorb materially higher operating costs—an outcome that would weigh on its fourth-quarter earnings outlook and likely trigger downward revisions to 2027 earnings-per-share estimates across the sell side.
