Over 140,000 drivers will receive a total of $60 million in tips for the time period between 2016 and 2019, which were illegally withheld by Amazon. The decision was announced on Tuesday by the Federal Trade Commission (FTC).
Amazon and its subsidiary, Amazon Logistics, were sued by the agency earlier this year for failing to pay its drivers the tips they had earned through the Amazon Flex programme.
The drivers working at Amazon Flex had been delivering products in orders made through Amazon's Prime Now and Amazon Fresh schemes. According to the lawsuit, Amazon withheld the drivers' tips for two and a half years and only stopped the practice after learning that the agency launched an investigation in 2019. In February, Amazon agreed to return the money.
Amazon Flex drivers were being paid between $18 and $25 an hour and 100% of the tips were going into the workers' minimum earnings.
However, in 2016, Amazon lowered the drivers' hourly rate without informing them of the change, and thus withheld their tips in order to account for the difference.
The drivers will receive from the agency 139,507 checks and 1,621 payments through PayPal. It is reported that those who had withheld tips over $5 dollars are expected to get back the full amount. The FTC also reported that the average amount owed to a single driver is $422, while the highest amount is $28,000.
An Amazon spokes person told Fox TV:
"While we disagree that the historical way we reported pay to drivers was unclear, we added additional clarity in 2019 and are pleased to put this matter behind us. Amazon Flex delivery partners play an important role in serving customers everyday, which is why they earn among the best in the industry at over $25 per hour on average across the country."
[Based on reporting by: Reuters]
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