Amazon to pay $61.7 million after FTC says company withheld tips from delivery drivers Coral Murphy Marcos, USA TODAY
Amazon delivery driver plays a quick game of hopscotch during route
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Amazon will pay more than $61.7 million to settle Federal Trade Commission charges of withholding tips from its delivery drivers, according to the FTC.
The FTC claimed the retail giant failed to pay Amazon Flex drivers the full amount of tips they received from Amazon customers from late 2016 to August 2019.
The consumer protection agency said Tuesday the settlement represents the full amount Amazon allegedly withheld from drivers and will be used to compensate them.
The Washington Post headline uses the term shortchanged instead of stolen while reporting these business practices of their owner, who happens to be one of the world s richest men, and was CEO of Amazon until yesterday. Via the Post:
SEATTLE Amazon for years promised contract drivers who deliver orders it would give them 100 percent of the tips they earned by delivering goods and groceries.
On Tuesday, it settled claims with the Federal Trade Commission, which found that statement false. Amazon agreed to pay the regulator $61.7 million, the amount the FTC claims the company shorted its drivers in tips over a 2½ year period.
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Welcome to Wiley’s update on recent developments and what’s next in consumer protection at the Consumer Financial Protection Bureau (CFPB) and Federal Trade Commission (FTC). In this newsletter, we analyze recent regulatory announcements, recap key enforcement actions, and preview upcoming deadlines and events. We also include links to our articles, blogs, and webinars with more analysis in these areas. We understand that keeping on top of the rapidly evolving regulatory landscape is more important than ever for businesses seeking to offer new and ground-breaking technologies.
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February 2, 2021
On Tuesday, the Federal Trade Commission (FTC) announced that it reached a $61.7 million settlement with Amazon to resolve claims that it failed to pay Amazon Flex drivers the full amount of customer tips they received during a two and a half year period. The FTC noted that it will use the $61.7 million, which allegedly represents the amount that Amazon withheld, to compensate the Amazon Flex drivers.
Amazon Flex is a program under which Amazon hires independent contractor drivers to make deliveries for the Prime Now and AmazonFresh program using their personal vehicle; the drivers can receive customer tips. The FTC complaint alleged that Amazon and its subsidiary Amazon Logistics advertised that Flex drivers would be paid $18-25 per hour and that drivers would “receive 100% of the tips you earn while delivering with Amazon Flex.” Additionally, Amazon purportedly advertised to customers that 100% of the tips they paid would be given to th