Tip Your Amazon Driver $5 for Free (Amazon Promise They’ll Get it This Time)
You can say “Alexa, thank my driver” to give your delivery driver a notification of your appreciation. Drivers who get the first one million thanks receive $5 at no cost to you.
The first five drivers also get $10,000 and $10,000 for a charity of their choice. Plus, Amazon get some nice publicity on the same day they’re sued for taking drivers’ tips.
In 2016, Amazon started using part of drivers’ tips to subsidize drivers’ base pay. Amazon was sued and settled the lawsuit with the Federal Trade Commission (FTC) by paying back the money it stole from employees.
Now, the District of Columbia is saying this wasn’t enough. Attorney General Karl A Racine wrote,
While Amazon later paid single-damages restitution for this conduct as part of a settlement with the Federal Trade Commission (“FTC”), multiple FTC Commissioners noted that Amazon’s ‘outrageous’ conduct would have warranted more than just restitution if the agency possessed authority to award penalties.
Karl went on to say,
Amazon has thus far escaped any other consequences. Plaintiff the District of Columbia (“District”), through its Office of the Attorney General, brings this enforcement action to hold Amazon to full account for its unlawful actions, and to send a clear message to employers not to divert tips for their own benefit.
Most of the Tips Go to Amazon
When Amazon launched its Flex delivery service, a pre-selected default tip in the checkout was included. It implied that 100% of the tip would go to the driver, and in 2015 they did.
Then, in 2016, the payment model was changed to make most of the amount of the tip go to Amazon and not the driver, but they never told anyone.
After the payment model changed, drivers could no longer see their tips and found that their take-home pay had decreased.
The drivers asked their regular customers if they were still being tipped and they said yes. Hundreds of drivers asked why they were getting less, but Amazon still lied to drivers and hid the fact that they were misleading customers on where their tips were going.
To mislead customers, Amazon used a variable payment system. A Variable Base Pay for a delivery block that only Amazon would know would be set and the actual delivery fee advertised on the platform would almost always be more than the Variable Base Pay.
When a driver was tipped, the difference between the Variable Base Pay and the actual rate would be covered by the tip.
Meaning if the variable rate was set to $15 and the actual delivery fee was $30 plus a $5 tip, Amazon would say the variable base pay was $25 and give a $5 tip while pocketing the extra $5. Amazon changed the payment system in 2019 to stop this practice.
Obviously the new Thank Your Driver feature will put a smile on the face of many delivery drivers. However, unfortunately for Amazon, it couldn’t have been announced at a worse time.