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Amazon Settles for $61.7M Over Claims that They Withheld Tips

Amazon will pay $61.7 million to settle allegations by the Federal Trade Commission that it failed to pay Flex delivery drivers the full amount of tips received from customers.

The commission voted 4-0 in favor of the settlement, which was announced Tuesday. In the complaint, the FTC alleges that Amazon in 2016 shifted from paying drivers the promised rate of $18 to $25 per hour, plus tips, to paying drivers a lower hourly rate.

Amazon “intentionally failed” to notify drivers of this change and used the tips to make up the difference between the promised rate and the new lower hourly rate, according to the FTC.

“Rather than passing along 100% of customers’ tips to drivers, as it had promised to do, Amazon used the money itself,” said Daniel Kaufman, acting director of the FTC’s Bureau of Consumer Protection, in a statement. “Our action today returns to drivers the tens of millions of dollars in tips that Amazon misappropriated, and requires Amazon to get drivers’ permission before changing its treatment of tips in the future.”

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