Is Amazon Flex a thief? The delivery platform has been silent over the past weeks, but now, they’re in the news, in a negative way.
The company has agreed to pay almost $4 million worth of settlement for the case they are currently in, saying they “stole” driver tips to use them for other expenses, illegally. And while they agreed, they are denying the allegations. Here’s the Ridesharing Forum team’s scoop.
To pay almost $4 million
That’s an incredibly huge amount, but Amazon Flex has agreed to pay almost $4 million – $3.95 to be exact – to settle a case that accused them of stealing the tips for drivers to subsidize its labor costs.
Washington, D.C.’s attorney general, Brian Schwalb, recently announced this, adding how Amazon Flex was misleading consumers in the are between 2016 and 2019 but assuring them all the tips would go to their drivers or those who deliver packages with their own cars.
With this assurance, consumers were led to pay tips with a generous heart. However, the attorney general found out they allegedly diverted millions of dollars in tips for external expenses, so the company was able to save on its own operating costs and increased their profits illegally.
“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,” the lawyer said.
Amazon Flex is Amazon’s gig-work courier service where drivers deliver goods from the Amazon official website, Prime Now, and other local stores.
Deliveries here are organized into blocks. Consumer use the official Amazon Flex app to find and schedule blocks for drivers, according to their availability. When you are available, you will head over to the delivery site or station, such as an Amazon fulfillment center or a supermarket, to pick up the packages and groceries for delivery.
As you arrive at the pickup location and check in, the app will offer a suggested route for your deliveries. Then, you’ll make the delivery just like how a delivery rider from other apps do it.
Stole over $1 million tips?
Since 2015, customers had been tipping their delivery drivers at checkout, with the notion 100 percent of the tips would go to the hardworking drivers.
However, a lawsuit has been filed saying Amazon Flex “stole” over $1 million in tips to cover its labor expenses.
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Amazon Flex denies allegations
To reach out to people, Amazon has spoken with the media and denied the allegations.
“For nearly a decade, Amazon Flex has empowered delivery partners to earn extra money on their own schedules,” an Amazon spokesperson said. “Like any successful program, Amazon Flex has evolved over time, and this lawsuit relates to a practice we changed more than five years ago. While we continue to disagree with these allegations, we’re happy to have the matter behind us so we can continue to focus on supporting delivery partners and customers.”
The $3.95 settlement fees that Amazon Flex will play include $2.45 million in penalties and $1.5 million in costs.