Amazon to Pay Fine for Withholding Tips From Delivery Drivers
Amazon on Tuesday agreed to pay $ 62 million to the Federal Trade Commission over allegations that it would withdraw tips to delivery drivers over a two-and-a-half-year period, in a case that would have been the federal government’s gig-economy. Uncovers growing interest in workers. .
The FTC said An announcement Amazon promised its flex delivery drivers that they would receive 100 percent of all customers’ tips. But starting in 2016, the FTC said, Amazon secretly reduced the wages of per-hour delivery, which was advertised from $ 18 to $ 25, and using customer tips to pay for shorter hours Tried to mask the wages. The net effect was that contract employees received smaller overall home-pay payments, the agency said.
This practice was not disclosed to drivers, but flex drivers saw a decrease in compensation and began to complain. The agency said that Amazon discontinued the practice in 2019. The company settled without admitting wrongdoing.
Daniel Kaufman, acting head of consumer protection at the FTC, said, “Instead of going over 100 percent to customers, as he promised, Amazon used the money itself.” In the future, Amazon has been given millions of dollars of tips before changing the treatment of tips, and for this Amazon will have to seek the permission of the drivers. “
Flex workers are classified by Amazon as independent contractors and often use individual vehicles for delivery of the company’s Prime Now and AmazonFresh items. Customers can give a tip to delivery drivers at the checkout page.
Amazon faces more regulatory scrutiny overall. The Seattle company is investigating for antitrust violations amid growing concerns from lawmakers and regulators about the power of large tech companies.
This case illustrates more bipartisan investigations on Big Tech’s treatment of contract workers, who form a large part of the workforce of Amazon, Google and Facebook.
“, Amazon is one of the largest and most feared corporate empires on the planet, and it is important that global regulators carefully scrutinize whether the company is misusing and misusing its market power through illegal practices,” Rohit Chopra, a Democrat and a commissioner, Said in a tweet About the township.
Amazon said in a statement that its pay for contract workers was “the best in the industry”.
“While we disagreed that we had not clarified the historical way of paying drivers, we added additional clarity in 2019 and are pleased to put the matter behind us,” it said.