FTC Orders Amazon to Pay Back $60 Million in Illegally Withheld Tips to Drivers

The Federal Trade Commission (FTC) announced Tuesday it would send over $60 million to roughly 140,000 Amazon drivers as reimbursement for tips that Amazon withheld illegally between 2016 and 2019.

"Amazon will pay more than $61.7 million to settle Federal Trade Commission charges that it failed to pay Amazon Flex drivers the full amount of tips they received from Amazon customers over a two and a half year period," the FCT says via a Mediaite quote. "The FTC's complaint alleges that the company stopped its behavior only after becoming aware of the FTC's investigation in 2019."

The FTC's battle with Amazon started when Amazon advertised that drivers in its Flex delivery program would make between $18–25 an hour and keep 100% of tips earned while delivering. Stunningly, Amazon lied and withheld the tips from the drivers. Next, the FTC sued Amazon earlier this year.

"Rather than passing along 100 percent of customers' tips to drivers, as it had promised to do, Amazon used the money itself," says Daniel Kaufman, Acting Director of the FTC's Bureau of Consumer Protection. "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."

Amazon has since agreed to settle the case and pay the total amount of $61.7 million owed. With the money, the FTC promises to grant 39,507 checks and 1,621 PayPal payments to the owed Amazon Flex drivers. The agency says that any driver from whom Amazon withheld more than $5 will receive the full amount back.

As a fan of truck drivers and a detractor of corporations, this is good news.