The trucks are branded Amazon prime in the photo, but the drivers are supposedly “independent contractors,” not Amazon employees, and they got stiffed by Amazon for their tips.
The drivers were part of Amazon’s Flex business, which was founded in 2015. The drivers are independent workers, and are not Amazon employees.
The FTC said Amazon at first promised workers that they would be paid $18 to $25 per hour. It also told them they would receive 100% of tips given to them by customers on the app. But in 2016, Amazon started paying drivers a lower hourly rate and used the tips to make up the difference, according to the complaint. Amazon didn’t disclose the change to drivers, the FTC said, and the tips it took from drivers amounted to $61.7 million.
Amazon will pay more than $61.7 million to settle charges from the Federal Trade Commission that it did not pay drivers in the Amazon Flex delivery service their full share of tips over a two and a half year period.
What’s happening: The FTC filed an administrative complaint against Amazon and Amazon Logistics, which the agency says told Amazon Flex delivery drivers and customers that the drivers would be paid the full amount of any tips added to a delivery.
- “Rather than passing along 100 percent of customers’ tips to drivers, as it had promised to do, Amazon used the money itself,” Daniel Kaufman, Acting Director of the FTC’s Bureau of Consumer Protection, said in a release.
- “Our action today returns to drivers the tens of millions of dollars in tips that Amazon misappropriated, and requires Amazon to get drivers’ permission before changing its treatment of tips in the future.”