Amazon Allegedly Steals Driver Tips to Reduce Labor Costs; New Lawsuit Claims It Defrauds Consumers

Amazon allegedly stole driver tips so that it could reduce its labor costs.

Now, a new lawsuit has been filed by the District of Columbia as authorities believe that this activity defrauds consumers.

Recently, Amazon already faced another lawsuit involving stolen driver tips.

To settle it, the e-commerce giant agreed to pay over $60 million in restitution to more than 140,000 drivers across the globe.

Amazon Allegedly Steals Driver Tips to Reduce Labor Costs

According to Bloomberg Laws' latest report, District of Columbia Atty. General Karl Racine filed a new lawsuit against Amazon on Wednesday, Nov. 7.

In his new complaint, he accused Amazon and Amazon Logistics Inc. of defrauding consumers by using drivers' tips to lessen labor costs.

Racine further explained that the giant retailer is using the tips while claiming that 100% of these would go to drivers.

Reuters reported that Amazon acquires these tips through its Amazon Flex service, allowing it to increase its profits.

The Federal Trade Commission claimed that Amazon has been doing this for the past two and a half years. However, e-commerce decided to stop this illegal activity after the FTC conducted its probe back in 2019.

What the New Lawsuit Seeks

The recent lawsuit filed against Amazon because of the stolen tips only required the company to return the amount.

This is why Atty. Racine decided to file a new lawsuit.

He explained that although the retailer paid over $60 million to thousands of drivers, it could still escape appropriate accountability.

These include any civil penalty for consumer harm. Racine added that it is not enough for the company to repay the amount it stole from employees.

"Stealing from workers is theft, and significant penalties are necessary to strongly disincentivize this unlawful conduct," added the attorney.

As of writing, Amazon has not released any statement about the new District of Columbia lawsuit filed against it.

You can visit this link to learn more about the issue of Amazon's alleged driver tip theft.

In other news, more Amazon layoffs will happen by 2023, as confirmed by the e-commerce giant's CEO.

Previously, we also reported that Amazon employees in 40 countries planned to protest during Black Friday sales events.

For more news updates about Amazon and the new lawsuit it faces, always keep your tabs open here at TechTimes.