Payments for more than $61.7 million in illegally withheld tips for drivers of Amazon Flex have begun to occur. Back in February, the Federal Trade Commission (FTC) settled legal action against Amazon for not paying out tips to its Amazon Flex drivers between 2016 and 2019. Amazon only stopped stealing its drivers’ tips after the FTC open an investigation in 2019. Advertisements for recruiting Amazon Flex drivers clearly indicated that drivers would receive 100% of earned tips. Customers of Amazon Flex were also told that drivers would receive 100% of tips.
For people who are unfamiliar with Amazon Flex, the program involves drivers who are independent contractors who deliver AmazonFresh and Prime Now deliveries that are distinct from the typical Amazon order. These drivers pick up orders and deliver them to customers, in a similar manner to food delivery apps, within hours.
The FTC has announced that it is issuing 139,507 checks and 1,621 PayPal payments to the affected drivers, indicating that about 141,128 Amazon Flex drivers had at least $5 in withheld tips from Amazon. The average amount of withheld tips is $422, with the largest payout coming in at over $28,000. About 20,000 of the drivers will receive payments greater than $600.
See the FTC press release here.
Businesses in California must follow specific employment law guidelines when it comes to tips and gratuity. Tips cannot be considered a part of an employee’s wages and management is not entitled to any amount of those tips. Businesses that pool tips to share with more employees have additional guidelines, including who is and who is not allowed to participate. Any violation of tipping laws, such as those seen in the Amazon Flex case, can be pursued under employment law.
The Law Offices of Scott Warmuth helps workers who have been treated unfairly and illegally by their employers by pursuing the companies who violate employment law. We provide free legal consultations and offer our services completely risk free with a no win no fee guarantee. Call us today at 888-517-9888.