The U.S. federal government is moving to settle a long-running case concerning Amazon.com's treatment of a group of delivery drivers, thereby avoiding a potentially landmark ruling on whether Amazon is the actual employer of workers it has long claimed are not its employees. Since 2024, the National Labor Relations Board (NLRB) has been pursuing litigation against Amazon, accusing the company of violating the rights of drivers employed by Battle-Tested Strategies (BTS), a contractor based in Palmdale, California, which previously operated as a "Delivery Service Partner" for Amazon.

In this case, the NLRB's General Counsel argued that Amazon acted as a "joint employer" of these drivers, meaning the company exerted sufficient control over them to be held accountable for their working conditions and obligated to engage in collective bargaining after they joined the International Brotherhood of Teamsters union. The government alleged that Amazon's refusal to negotiate with the union was therefore unlawful.

At the start of a trial before an NLRB judge in Los Angeles last September, the government contended that Amazon exercised "overwhelming control" over its subcontractor drivers, while the contractors handling payroll were essentially "captive delivery companies" created under Amazon's direction. Amazon has denied any wrongdoing, refused to comply with government subpoenas regarding its joint employer status—calling the request a "fishing expedition"—and accused the NLRB of pursuing the case with improper motives.

Testimony in the trial, which was scheduled to resume on April 13, has now been suspended. Last Sunday, an attorney for the NLRB General Counsel submitted a proposed settlement to the presiding judge to conclude the case. According to a copy of the settlement agreement, Amazon would pay up to 84 workers employed by BTS the equivalent of two weeks' wages but would not admit to any wrongdoing or accept a joint employer designation.

If approved, the settlement would resolve one of the most significant cases the NLRB has brought against Amazon. The case had the potential to lead to a first-time ruling—by an agency judge, the NLRB board in Washington, or eventually a federal appeals court—that Amazon is a joint employer of drivers working for one of its delivery service partners. Amazon currently contracts with thousands of such partners, who manage hundreds of thousands of delivery workers.

Neither Amazon nor the NLRB provided immediate comment on Sunday evening. The shift in the agency's stance follows its restructuring under the influence of Donald Trump. Trump appointed Crystal Carey, a partner at law firm Morgan, Lewis & Bockius LLP—which counts Amazon among its clients—to the role of NLRB General Counsel. Carey assumed the position of the agency’s top prosecutor in January, a role that holds broad authority over which cases the NLRB pursues and how.

In a February interview, Carey stated that because her prior representation of Amazon occurred over a year ago and her former firm is not involved in the Palmdale case, recusal was unnecessary. She described recusal requirements as "case-specific."