“Workers in the District of Columbia and across our nation are too often underutilized for their hard-earned wages,” Racine said in a statement. “Plus, consumers need to know where their tips go. This lawsuit aims to tip employees and tell consumers the truth. One of the richest companies in the world. Amazon, which is one, certainly does not have to accept employee tips.”
The lawsuit concerns Amazon Flex, a service that offers expedited delivery that was launched in 2015. At the launch, the company encouraged consumers to tip the delivery driver and ensured that his 100% of the tip was paid to the driver.
According to the lawsuit, Amazon changed its model in 2016 so that drivers could no longer see the tip amount for each delivery, and instead the majority of the tip was used to pay drivers already promised wages. The lawsuit further alleges that the company misled consumers and workers about the model by hiding the reality of its tipping policy.
An Amazon spokesperson said in an email that the lawsuit had no merit, and the company changed its model in 2019, creating a compensation framework that ensures drivers in D.C. earn more than the district’s minimum wage. He added that he had
In 2021, Amazon will reimburse Amazon Flex drivers as part of a settlement with the Federal Trade Commission (FTC), banning them from changing how drivers are tipped without prior notice to drivers nationwide. agreed to a legal injunction.
“There is nothing more important to us than the trust of our customers. This lawsuit involves practices that we changed three years ago for no benefit. Drivers have already been paid as part of a settlement with the FTC,” Amazon spokeswoman Maria Boschetti said in a statement Wednesday.
Racine argued that the company has not yet been held liable for the “consumer injury” violation of DC’s Consumer Protection Procedures Act (CPPA).
The Attorney General’s Office is seeking civil penalties for each violation of the CPPA, payment of legal costs to the district, and a court order to prevent the company from engaging in the practice again.
This is the second lawsuit Racine has filed against the industry giant. In 2021, his office filed an antitrust complaint against the company, alleging that Amazon’s retention of monopoly power led to higher prices for consumers. A DC Superior Court judge dismissed the antitrust case earlier this year.
In April, the OAG and the US Department of Justice asked the court to reconsider its dismissal of the antitrust lawsuit against Amazon. Then, in August, the Office of the Attorney General filed a notice of appeal. The city and Amazon have until the end of January to submit their claims to the DC Court of Appeals before proceeding with the lawsuit.
