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Amazon has been ordered by the US Federal Trade Commission to pay back its delivery drivers because it collected the tips that were supposed to be given out to them. The commission is asking Jeff Bezos’ company to pay them around $62 million to settle the charges.
FTC’s investigation against Amazon
The order was forwarded to Amazon after the FTC discovered that it did not pass the tips to delivery drivers that were included in the customers’ bills. Based on the agency’s review, the online retailer has withheld the tips for over two years now even though it already promised the drivers and shoppers that the tips would be distributed.
What’s more, the FTC discovered that Amazon suddenly stopped taking the tips in 2019 when it learned that an investigation against them is being carried out by the agency.
"This theft did not go unnoticed by Amazon's drivers, many of whom expressed anger and confusion to the company," WCVB5 News quoted FTC Commissioner Rohit Chopra as saying in a statement. "But, rather than coming clean, Amazon took elaborate steps to mislead its drivers and conceal its theft, sending them canned responses that repeated the company's lies."
The drivers that were stripped of the tips are those who were part of Amazon's Flex business. This was established in 2015, and through its system, people are allowed to deliver Amazon packages using their own cars. But then, the drivers are not employees of Amazon, but rather, they are independent workers.
How the trouble with the tipping started
As per Channel News Asia, the Federal Trade Commission revealed that Amazon made a promise of paying the independent drivers $18 to $25 per hour for their service. The retail company also told them they will be receiving 100% of the tips given by the customers to them; however, in 2016, the company began paying lower rates, then the tips were used to make up for the difference.
The worst thing is that Amazon didn't inform the drivers about these changes. Based on the FTC’s computations, Amazon owes the drivers around $61.6 million.
To end the case, Amazon will be paying for settlement, and the FTC said that this money will be returned to the drivers for the tips that were taken from them a few years ago.
