Amazon Will Pay $62 Million Over Deceptive Delivery Tips Claims (protocol.com) 45
Amazon will pay almost $62 million to settle allegations by the U.S. Federal Trade Commission that it avoided handing over the full pay and tips it promised to delivery drivers, according to the agency. From a report: The company is giving back the amount it kept, according to a complaint released earlier this year by the agency, after it told Amazon Flex drivers and customers in 2015 it would pay $18 to $25 hourly plus tips. Instead, beginning the following year, it used tips to supplement lower base pay rates, and tried to hide the changes, according to the FTC.
Guessing more than that (Score:4, Informative)
falls out of Bezos pockets as he plummets back to earth...
"For a period of over two and a half years, without consumers' permission, Amazon secretly used nearly a third of customer tips to subsidize its own pay to drivers," the FTC had found.
This is exactly what DoorDash already got caught doing as well. [mercurynews.com]
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And now people know why unions exist. Boss certainly isn't going to be looking out for the employees.
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Re:Guessing more than that (Score:5, Interesting)
Some of the other comments have called this stealing. While morally it may have been stealing, legally It wasn't. At least not until someone decides to fight the FTC on it all the way to court, and the court issues a decision which determines that it was stealing. Or Congress passes a law specifically outlawing this behavior. It only becomes stealing under the law after one of those things happens.
If you own a business, you know the IRS tax law is full of this stuff [irs.gov]. Vagueness and holes in the tax code. You ask your accountant "what does the law say I should do here?" And they tell you they don't know. They won't know until you do it, the IRS says you can't and takes you to tax court on it, and the tax court decides whether or not what you did was legal. The U.S. is a common law [wikipedia.org] country, not a civil law country. So there's no predisposition for the law to be interpreted erring in favor of being most permissible (most civil law countries) or least permissible (most communist countries and dictatorships). In common law, the interpretation of any ambiguity is left entirely up to the courts, and you can't be certain which way they'll rule until they actually do rule. The best you can do is ask the IRS for a written determination on what's the correct, legal way to proceed. And if you follow it, the IRS won't take you to court over it (though a future IRS might decide otherwise).
If you don't like the written determination and have the finances to fight it in court, you can ignore it. Let the IRS take you to court, and hope the court rules in your favor and against the IRS (yes it does happen). Or any point along the way, you can change your mind and decide you'll probably lose in court, and settle to end the lawsuit before the court takes away all your negotiating leverage.
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Wage theft is theft.
Why are delivery drivers tipped (Score:2)
Re:Why are delivery drivers tipped (Score:5, Insightful)
"pay them for it"
There's your answer and the main issue with tipping culture in the first place, if companies can shift that onto the consumer via guilt or cultural obligation they will.
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There's your answer and the main issue with tipping culture in the first place, if companies can shift that onto the consumer via guilt or cultural obligation they will.
Ever ask waitresses and waiters what they want? They were talking about getting rid of tipping in a city near me and the wait staff went berserk. They were screaming at city council at the meeting where they discussed the proposal. One restaurant tried paying their staff a "living wage" on their own, and they went out of business within a year.
Re:Why are delivery drivers tipped (Score:4, Informative)
The ones working at nice restaurants making $50/hr are the ones ranting at city council. Certainly not the Denny's or Waffle House staff making a few dollars/hr in tips.
re: tips at nice restaurants (Score:3)
This is technically true... I had a cousin, for example, who graduated with a law degree but spent years working as a waitress in the DC area because the pay after tips was better than what she could earn in law.
But yeah, I'd like to see the lower priced "family" chain restaurants and diners simply guarantee a reasonable hourly wage if and when tips don't add up to that, and leave it at that. It's not fair that a server gets penalized because of the bad luck of getting stuck waiting tables for cheapskates
Re: re: tips at nice restaurants (Score:2)
They're already required to pay at least minimum wage if the tips don't make up for it.
Re: re: tips at nice restaurants (Score:4, Informative)
Right, but my point is - the minimum wage they require for servers is typically much lower than the minimum everyone else is guaranteed. That's always been a "loophole" in the law because they assumed the job was paid for mostly with tips.
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https://www.paycor.com/resourc... [paycor.com]
Actually, this site gives a pretty complete summary of the laws, which vary pretty wildly by state.
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Re: Why are delivery drivers tipped (Score:1)
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In Seattle, waiters/waitresses make $15/hour.
Tipping expectations were not reduced.
The whole “most make less than minimum wage” thing isn’t really relevant, because even if they made three times minimum wage, you’d be expected to pay. Tipping expectations never go down.
Since there no rent control, when cities increase minimum wages, rents go up to capture that increase, and then some. Since few people who make minimum wage are homeowners, Increased minimum wages are little more tha
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In Seattle, waiters/waitresses make $15/hour. Tipping expectations were not reduced.
I'd like to see a study on that. If I'm paying $16 for a plain hamburger at the Cheesecake Factory, which is ludicrous, the waiter isn't going to get a 20% tip. Crap, the most expensive burger near me is a $20 Kobe beef burger at one of the nicest restaurants in the area, in a swanky part of town. Those waiters *will* be getting a 20% tip.
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Tipping expectations were not reduced.
Uh, they were at the Seattle restaurants I went to, Especially where the tipping expectations were clearly communicated.
Tipping expectations never go down.
Apparently says you, again.
Are you working for some kind of PR firm? Some kind of "I don't pay attention to the reality others experience" person?
Re: Why are delivery drivers tipped (Score:1)
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Ever ask waitresses and waiters what they want?
Not trying to insult them, but I don't trust that a high school graduate in the US has a firm enough grasp of basic arithmetic for them to understand they will end up making the same total amount.
Re: Why are delivery drivers tipped (Score:1)
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Ever ask waitresses and waiters what they want?
Sorry, that's pretty insulting. Even in "basic" jobs, workers are usually acutely aware of their financial situation. There are exceptions, but those aren't the rule. I know someone who used to drive a beer delivery truck, who could figure out, in his head, exactly how much money should be in his strong box, solely based on how many hundreds of cases he delivered, without looking at his logs or invoices. His education topped out at a high school diploma and a commercial driver's license. He said it wasn't u
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Does that guy get paid in tips? Ever ask him why not?
Tips (Score:2)
He would sometimes get tips, yes. Why?
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Did he declare them on his taxes? Maybe they don't want to get rid of tipping because it will make it harder to commit tax evasion.
Re:Why are delivery drivers tipped (Score:4, Insightful)
Frankly I don't care what they think. The whole idea of some labor is tipped and some isn't is seemingly arbitrary distinctions and a relic of times gone by. Frankly I also want that wait staff to be able to tell rude customers to fuck off and not worry about losing money because of it. Tip culture is poisonous and counterproductive.
Frankly the whole idea should be scrapped and labor should be paid as labor, otherwise one can look at those labor sectors as labor market failures.
An anecdote from place does not make policy. Were they a terrible place to work to begin with? What was their idea of "living wage" and was it in line with what it costs to live in the area in which they operate?
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I guess people aren't use to the "evil" mindset. What's the easiest way to hide wrongdoing?
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Because minimum wage laws were designed to exclude certain classes of low-wage workers?
Employers try to avoid minimum wage laws to increase profits?
Companies try to avoid employees to increase profits?
If I stole 62 million dollars... (Score:1)
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You own a bank, don't you?
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Yep, or you'd at least be expected to pay something along the lines of triple what was stolen. It's more likely here that 62 million is a fraction of their take.
No punitive element (Score:3)
The company is giving back the amount it kept
So all this amounts to is "Oh well, you got me. Though it was worth trying."
You would have hoped that, if for no other reason than the failed attempt to conceal this, the regulators would have slapped a fine on the company. A sufficiently large fine that would deter any future attempt at something similar
Instead the message is neutral. And in the corporate mind, no punishment equates to approval.
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You would have hoped that, if for no other reason than the failed attempt to conceal this, the regulators would have slapped a fine on the company. A sufficiently large fine that would deter any future attempt at something similar
Paid in Bitcoin. It is the legally recognized tender for ill-gotten gains.
People tip the drivers? (Score:2)
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Not cash tip, if it was Amazon couldn't have gotten their hands on it. When you place an order for Amazon Fresh or Whole Foods you have the option to tip the driver then, and modify up to several hours after the delivery. I imagine more people were also tipping on their order in the last year.
Re:People tip the drivers? (Score:4, Informative)
It's for Amazon Prime Now deliveries subcontracted out to Amazon Flex drivers.
How much tips do you earn with Amazon Flex Prime Now deliveries? [moneypixels.com]
In the Amazon Prime Now app, the customer can choose a tip amount, but Amazon provides a default amount of $5 or 10% of the order total, whichever is greater, with the text “recommended” placed next to the amount, in parenthesis. If the customer prefers to change the tip amount, they must manually click into the tip screen and change the amount.
Customer Pro-tip: If you want to make sure your service agent gets 100% of your tip without any of it going to cover "salary", then pay in cash directly to the agent.
Re: People tip the drivers? (Score:2)
This is exactly what I do after Doordash got caught doing similar tactics. I'll occasionally pay a small tip on the app and hand over cash on top. Let's be honest, these guys aren't claiming every red cent in cash to the IRS.
Re: People tip the drivers? (Score:1)
This wasnâ(TM)t the normal Amazon delivery, it was a program where they had contractors using their own vehicles for 1/2 hour delivery, called âoeflexâ. They had a built-in tip interface where they would collect the tip, and then use that to reduce their hour payment so they would only receive their promised rate when you included tips.
You see coimpanies caught all the time (Score:2)
Tipping only benefits the owner (Score:1)
Rules for Tipping (Score:2)
I do not tip if one of the following are true:
1. The tippee sets the price of the goods/service.
2. The service is required by statute.
3. The tippee requires a government license.
4. The service is not required by me.
5. The tip amount is set by company or government policy.
6. The tip is not entirely voluntary.
7. The tip is not declared for tax purposes.
8. The tippee is represented by a union.
9. The service is less than good.