More than 140,000 Amazon Flex drivers will receive reimbursements for tips that were illegally withheld by the e-commerce giant from them between 2016 and 2019.
The Federal Trade Commission (FTC) is sending almost $60 million in reimbursements to Amazon Flex drivers in the form of checks and PayPal payments.
Earlier this year, the FTC filed an administrative complaint against Amazon.com Inc (NASDAQ: AMZN) and its subsidiary, Amazon Logistics for allegedly failing to pay 100% of the tips that Amazon Flex drivers earned. The Commission also alleged that the e-commerce giant failed to notify drivers about its decision to lower its promised $18 to $25 per hour rate for delivering packages to consumers.
The e-commerce giant settled with the FTC and agreed to pay more than $61.7 million in tips that it allegedly ripped off from Amazon Flex drivers. The Commission prohibited Amazon from misrepresenting any driver’s potential income or hourly rate, the percentage of their tips that will be paid to them, and whether the amount paid by a customer is a tip. The FTC also prohibited the e-commerce giant from using drivers’ tips as compensation without obtaining their consent.