A lawyer almost certainly told execs that this was an illegal attempt to misclassify employees. I think we’re getting to a place where if people do things even though a lawyer tells them it’s illegal, they are personally liable (jointly with the org itself) for the decision even in the context of a limited liability organization. And if the lawyer is incompetent enough to tell them that it’s legal, they need to be disbarred and potentially liable for the damages.
Classically the scam is to hire an individual and tell them they are a contractor. Amazon has actually subcontracted to a separate company that employs the drivers. Yes they basically setup the subcontractors, but afaik the IRS actually sees the drivers as employees of the contractor company.
Now the NLRB may have a different opinion when it comes to Amazon using this structure to disrupt union formation. There’s a reason they are trying so hard to win this idea that the drivers don’t work for Amazon. They’re afraid the NLRB and courts won’t see this their way.