Amazon drivers to receive $ 60 million after tip withholding

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Image of article titled Amazon Must Pay Thousands Of Flexible Drivers An Average Of $ 422 After Withholding Tips

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Starting today, the Federal Trade Commission will start doing something Amazon hasn’t done for about 140,000 of its Flex delivery drivers: tip them off.

In total, the FTC announcement it will send nearly $ 60 million in withheld tips to drivers as part of a regulation with Amazon which was reached earlier this year. Drivers will receive an average payment of $ 422, and a driver is expected to receive over $ 28,000. Almost 20,000 drivers are expected to receive payments over $ 600. The funds themselves are expected to appear in the form of 139,507 checks and 1,621 PayPal payments, according to the FTC.

The agency first launched its investigation in Amazon’s Flex practices in 2019 before taking legal action alleging the company withheld $ 61.7 million in tips from drivers between 2016 and 2019. According to the FTC complaint, Amazon lowered the hourly rate for its Flex drivers in late 2016 and used customer tips to make up the difference, all without disclosing the changes made to the drivers. Amazon had guaranteed its drivers that they would receive 100% of their tips, which clearly did not happen.

In its first complaint, The FTC said Amazon “used tens of millions of dollars in customer tips to subsidize driver payments” and “continued to deflect tips from drivers during this time despite hundreds of complaints from drivers about the practice. , critical media reports and internal recognition that his conduct was “reputable powder snow”.

In addition to forgoing the $ 61.7 million in withholding tips, FTC regulations prohibit Amazon from distorting a driver’s likely rate of pay and require transparency on how much of his tips he should pay. expect to win.

Of course, Amazon isn’t the only company guilty of shady tipping practices. DoorDash food delivery service company has previously used customer tips to make up for the shortfall in the base salary promised to his drivers. Instacart was also forced to cash his tipping practices last year after legislators questioned the app’s propensity to ‘tip bait’. Uber, meanwhile, didn’t even offer tip until 2017 (although according to a 2019 study, only about 16% of Uber trips actually receive tips).

Although lawmakers are busy proposing heavy anti-trust laws legislation which, in theory, would radically change the way large businesses are regulated and supervised in the United States, the Amazon Flex regulation is a reminder of what is still possible using the rules and regulations currently in place.



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