Amazon Ordered to Pay Fine for Withholding Tips From Delivery Drivers - Gig Workers
Amazon has finally agreed to pay $62 million to the
Federal Trade Commission (FTC) to settle the charges related to the withholding
of tips that were supposed to go to its flex/temp gig delivery drivers over a
period of two-and-a-half years.
As per the FTC announcement Amazon
had promised its gig economy delivery drivers that they would receive 100
percent of all the tips that they would receive from the customers but almost 4
years ago in 2016, the e-commerce giant secretly reduced the delivery wages of
$18 to $25 per hour and 100 percent of all the tips that totaled more than $61
million dollars. Amazon used the customer tips to make up the difference
between the new lower hourly rate and the promised rate which resulted in the
contract/gig workers receiving less overall take-home wage.
The gig workers that were working for the amazon delivery
business were kept in the dark as this new shift in policy was not disclosed to
them but after some time the drivers started noticing the reductions in their
compensation started to complain. Amazon canceled this policy after becoming
aware that they are getting investigated by the FTC. Subsequently, Amazon
settled with FTC but without accepting any wrongdoing.