140,000 Amazon drivers will get back $60M in allegedly withheld tips
The FTC is sending out 139,507 checks and 1,621 PayPal payments
About 140,000 Amazon drivers whose tips were allegedly withheld for multiple years will receive a reimbursement check from the Federal Trade Commission (FTC).
The agency announced this week that it's sending nearly $60 million in funds that "Amazon allegedly illegally withheld from drivers between 2016 and 2019."
| Ticker | Security | Last | Change | Change % |
|---|---|---|---|---|
| AMZN | AMAZON.COM INC. | 202.61 | -8.87 | -4.19% |
Representatives for Amazon did not respond to FOX Business' request for comment.
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The funds stem from the FTC's earlier lawsuit against Amazon and its subsidiary, Amazon Logistics, which is its network of delivery providers.
In the suit, the FTC alleged that Amazon didn't pay Amazon Flex program drivers the full amount of tips that they earned during the two-and-a-half-year period. Flex drivers deliver goods and groceries ordered through programs like Prime Now and AmazonFresh.
An Amazon Prime delivery van is seen after leaving a distribution center on July 14, 2019 in Orlando, Fla. ( Paul Hennessy/NurPhoto via Getty Images / Getty Images)
The suit alleges that "for a period of over two and a half years, without consumers’ permission, Amazon secretly used nearly a third of customer tips to subsidize its own pay to drivers" and as a result, "ultimately pocketed over $61 million in tips meant for drivers."
The complaint further alleges that Amazon stopped such practice after "becoming aware of the FTC’s investigation in 2019," the federal agency said.
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In February 2021, Amazon agreed to settle the case and "surrender all the money it withheld from its drivers," the FTC said. This amounted to more than $61.7 million.
As part of the settlement, "Amazon also will be prohibited from making any changes to how a driver’s tips are used as compensation without the driver’s express informed consent," the FTC said.
The FTC is now sending out 139,507 checks and 1,621 PayPal payments to impacted Amazon Flex drivers.
The average amount being sent back is about $422. However, the highest amount going to a single driver is $28,000, according to the FTC.
