Amazon to Pay $60 Million for Tips it Withheld from Flex Drivers
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The US Federal Trade Commission (FTC) will send out more than $60 million for drivers from Amazon's Flex program, which the company had illegally withheld.
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The company settled with the Federal Trade Commission earlier this year
According to the FTC, it is in the midst of preparing around 140,000 checks and 1600 PayPal payments for drivers from Amazon's Flex program who had more than 5$ in withheld tips.
The FTC had sued Amazon in 2019, following an extensive investigation that revealed that the tech giant withheld tips from drivers over two and half years. "In total, Amazon stole nearly one-third of drivers’ tips to pad its own bottom line,” FTC Commissioner Rohit Chopra said in a statement in February, accusing Amazon of “expanding its business empire by cheating its workers.”
Amazon lowered drivers' wages without telling them
Amazon continued to collect portions of the drivers' tips until the government filed the lawsuit, which Amazon agreed to settle earlier this year in February. “Rather than passing along 100 percent of customers’ tips to drivers, as it had promised to do, Amazon used the money itself,” said Daniel Kaufman, acting director of the FTC’s Bureau of Consumer Protection said at the time.
Flex drivers are expected to receive their tips before January 7th, 2022, with the average repayment being close to $422. Close to 20,000 drivers will receive checks for more than $600 with one driver receiving the highest payout of more than $28,000.
Drivers with the Amazon Flex program are contracted to deliver Amazon packages in their own vehicles. According to the FTC's lawsuit, customers and drivers were told by Amazon that the drivers would receive 100% of any tips paid.
In 2016, however, Amazon allegedly lowered the minimum hourly pay for drivers, making up the difference with drivers' tip money. The drivers, according to the FTC, were not notified of this change.
