Amazon Settles Lawsuit Over Stolen Tips from Flex Delivery Drivers

Amazon has agreed to pay the District of Columbia $3.95 million to settle a lawsuit alleging that the retail giant had stolen more than $60 million in tips intended for its Flex delivery drivers. The settlement includes $2.45 million in penalties and requires Amazon to clearly disclose how tips are being used for any purpose besides compensating drivers.

The Tip-Taking Scandal

The lawsuit, filed in 2022, alleged that Amazon had misused tips intended for its Flex drivers. The company had been accused of taking tips from customers and using them for its own purposes, rather than distributing them to the drivers as promised. The lawsuit sought to hold Amazon accountable for its actions and to send a message to employers that they should not divert tips for their own benefit.

Consequences for Amazon

The settlement is a significant blow to Amazon, which has been accused of taking tips from customers and using them for its own purposes. The company has agreed to pay $3.95 million to settle the lawsuit, which includes $2.45 million in penalties. The settlement also requires Amazon to clearly disclose how tips are being used for any purpose besides compensating drivers.

DC Attorney General’s Statement

“When companies mislead customers to boost their profits by stealing tips intended for their workers, they are cheating their consumers, their employees, and their competitors who play by the rules,” said DC Attorney General Brian L. Schwalb. “It’s not sufficient, after being caught, to simply give back the ill-gotten gains. Rather, there must be meaningful consequences to deter misconduct from happening in the first place.”

Amazon’s Response

While Amazon has agreed to the settlement, the company denies the DC allegations and maintains that it made “truthful, complete, unambiguous, and accurate representations to customers” regarding its tipping process for drivers. The company has 30 days to settle the lawsuit and pay the agreed-upon amount.

What’s Next?

The settlement is a significant step forward in holding Amazon accountable for its actions. The company’s agreement to pay $3.95 million and to clearly disclose how tips are being used for any purpose besides compensating drivers is a major victory for the District of Columbia and for the Flex drivers who were affected by the company’s actions. The settlement serves as a reminder to employers that they must be transparent and honest in their business practices, and that they will be held accountable if they fail to do so.