Speaker 1: I want to thank every Amazon employee and every Amazon
Speaker 1: customer because you guys paid progress. You guys paid problems.
Speaker 1: This is megaical an investigative podcast exposing some of the
Speaker 1: world's most unethical corporations. This series is about Amazon. I'm
Speaker 1: Jake Hanrahan, journalists and documentary filmmaker. Mega Corp is produced
Speaker 1: by H eleven for cool Zone Media. Picture this. You're
Speaker 1: a freelance Amazon delivery driver what's known as an Amazon
Speaker 1: Flex driver. You deliver packages, You do your best, you
Speaker 1: make your realms. It can be a fairly low paying job,
Speaker 1: but if you get decent tips from the customers you
Speaker 1: deliver to, you'll be able to make do. Probably you're
Speaker 1: not going to get rich doing this, but every little helps.
Speaker 1: Secretly though, imagine this in the background. The company you
Speaker 1: work for, Amazon, which is owned by the world's richest man,
Speaker 1: is literally stealing money from your tips that weren't enough
Speaker 1: to make you furious. I don't know what is Believe
Speaker 1: it or not, though this is not a hypothetical situation.
Speaker 1: This is exactly what happened at Amazon. For two and
Speaker 1: a half years. Amazon was effectively stealing money from the
Speaker 1: tips of Amazon Flex drivers when they got caught. Amazon
Speaker 1: was fined sixty one point seven million dollars by America's
Speaker 1: Federal Trade Commission or the FTC in one somehow, though,
Speaker 1: get this, they got richer of the back of that.
Speaker 1: Now you're probably thinking, how the fuck. Well, let's get
Speaker 1: into it. So the fine I just mentioned is actually
Speaker 1: roughly the amount Amazon stole from its Flex drivers. According
Speaker 1: to journalists Will a remus of one zero. That's sixty
Speaker 1: one point seven million dollars roughly taken from drivers. What's more,
Speaker 1: in the hours after the FTC fine announcements came out,
Speaker 1: Amazon's stock prices rose by one to two percent. Yeah,
Speaker 1: that's right, they rose. This added around twenty billion dollars
Speaker 1: to the company's market value, As Will Arima says in
Speaker 1: his one zero article, Corporate crime Pays. So anyway, how
Speaker 1: did this scam work? Well, basically, Amazon Flex drivers work
Speaker 1: for a guaranteed minimum hourly rate. Anything they make on
Speaker 1: top via tips was supposed to be there's extra money.
Speaker 1: Amazon told them that they would be able to one
Speaker 1: of the tips. Likewise, with the customers, they were told
Speaker 1: if they tipped their driver, all of it would go
Speaker 1: to the driver. What happened, though, is that Amazon was
Speaker 1: effectively building a pyramid scheme, using the money from tips
Speaker 1: to pay the minimum hourly rate of the drivers at times,
Speaker 1: and then secretly deducting the tips before they got them.
Speaker 1: This is completely criminal. If you or me did something
Speaker 1: like this, we'd probably go to prison. But Amazon seems
Speaker 1: to be above the law. Journalist Joanna Brien first broke
Speaker 1: this story for The l A. Times. She wrote, quote
Speaker 1: Amazon at times deeps into the tips earned by contracted
Speaker 1: delivery drivers to cover their promised to pay. A Times
Speaker 1: review of emails and receipts reveals Amazon guarantees third party
Speaker 1: drivers for its Flex program a minimum of eighteen dollars
Speaker 1: to twenty five dollars per hour, but the entirety of
Speaker 1: that payment doesn't always come from the company. If Amazon's
Speaker 1: contribution doesn't reach the guaranteed wage, the e commerce giant
Speaker 1: makes up the difference with the tips from customers. According
Speaker 1: to documentation shared by five drivers. In emails to drivers,
Speaker 1: Amazon acknowledges it can use any supplemental earnings to meet
Speaker 1: the promised minimum should the company's own contribution for short.
Speaker 1: Amazon insists that the drivers received the entirety of their tips,
Speaker 1: but they declined to answer questions about whether it uses
Speaker 1: those tips to help the drivers a base pay end quote.
Speaker 1: An Amazon spokesperson named Amanda I wrote the following in
Speaker 1: a statement, quote, our pay commitment to delivery drivers has
Speaker 1: not changed since we launched the Amazon Flex program. Delivery
Speaker 1: partners still earn eighteen dollars per hour, including one of tips,
Speaker 1: and on average, drivers earn over twenty dollars per hour
Speaker 1: end quote. Well, as we know, it seems like the
Speaker 1: FTC disagrees with that. Now. Amazon conveniently doesn't actually provide
Speaker 1: drivers with a breakdown of their tips and pay beyond
Speaker 1: showing them their full payout. So the way some cunning
Speaker 1: Amazon Flex drivers called Amazon out was by checking the
Speaker 1: tips paid to them when delivering packages to their own houses.
Speaker 1: One driver, for example, tipped himself fifteen dollars and ninety
Speaker 1: cents when delivering a package of paper towels to his
Speaker 1: own home. When he checked his account two days later,
Speaker 1: he saw that he was credited as receiving no tips
Speaker 1: for the whole two hours shift that day, the one
Speaker 1: where he tipped himself. When he put in a formal
Speaker 1: complaint to Amazon about this, they adjusted his pay without
Speaker 1: any explanation. Seemingly adding extra tips on top two. Now,
Speaker 1: believe it or not, some of this is actually legal
Speaker 1: in some places in America, reported by the l a
Speaker 1: Times article quote, the practice is legal in some states.
Speaker 1: The California Labor Codes Provision three five one, which targets
Speaker 1: the practice, does not apply to contractors because they are
Speaker 1: seen as independent business owners. In Seattle, a group of
Speaker 1: drivers has contested the classification in appending class action lawsuit,
Speaker 1: claiming they are actually treated as employees. Amazon would not
Speaker 1: say whether it dips into drivers tips in California. End quote. Now,
Speaker 1: eventually Amazon was found out and this huge fire was
Speaker 1: given to them. As we know, Amazon said they didn't
Speaker 1: really accept what was levied at them, but they paid
Speaker 1: the fire anyway. Here's what the FTC had to say
Speaker 1: about it in a press release from one quote. According
Speaker 1: to the FTC, these administrative complaints against Amazon and its subsidiary,
Speaker 1: Amazon Logistics. The company regularly advertised that drivers participating in
Speaker 1: the Flex program would be paid eighteen to twenty five
Speaker 1: dollars per hour for their work making deliveries to customers.
Speaker 1: The ads, along with the numerous other documents provided to
Speaker 1: Flex drivers, also prominently featured statements such as you will
Speaker 1: receive one percent of the tips you earn while delivering
Speaker 1: with Amazon Flex. Rather than passing along one percent of
Speaker 1: customers tips to drivers as it had promised to do,
Speaker 1: Amazon used the money itself. Our action today returns to
Speaker 1: drivers the tens of millions of dollars in tips that
Speaker 1: Amazon misappropriated, and requires Amazon to get drivers permission before
Speaker 1: changing its treatment of tips in the future. Pend quote.
Speaker 1: To get an idea of what it's like working as
Speaker 1: an Amazon Flex driver, I spoke to someone that is
Speaker 1: currently still working for them. We'll call him Bob. Bob
Speaker 1: believes that he had tips stolen from him in the past,
Speaker 1: and he has several other grievances with Amazon's Flex driver program.
Speaker 1: Let's see what he had to say. They have not
Speaker 1: exactly been fair. They've not been treating you guys right.
Speaker 1: The biggest issue is Amazon will dispatch stuff late or
Speaker 1: they'll they'll be whether delays or a myriad of issues.
Speaker 1: And when it comes right down to it, every time
Speaker 1: something is late, they automatically blame the drivers for it
Speaker 1: and then punish the drivers for it. There's no middleman.
Speaker 1: You can try and appeal it, but the only time
Speaker 1: I've ever been successfully appealed anything is to go to
Speaker 1: their escalations department because all of their support is offshore
Speaker 1: now and people don't understand or they just don't care.
Speaker 1: I mean, I'll get emails like, oh, well, we're not
Speaker 1: going to investigate this issue. It's like, I understand that
Speaker 1: I'm a contracted person and I'm not an Amazon employee,
Speaker 1: but where is the fairness in this? So, for example,
Speaker 1: yesterday they took a whole Food's order and I had
Speaker 1: taken three previous orders and gone back to the location,
Speaker 1: and they gave me an order that was literally sitting
Speaker 1: on the shelf when I said of the first time.
Speaker 1: And now it's late, and now I'm being blamed for
Speaker 1: the late delivery, even though they could have dispatched it
Speaker 1: to me when I was there the first time. But
Speaker 1: they're holding me accountable for the late delivery. And and
Speaker 1: the same holds true for if packages go missing, it's
Speaker 1: the driver's fault. If the package is damaged, it's the
Speaker 1: driver's fault. I left packages at the location because they
Speaker 1: were damaged, and I'm still being held accountable for him.
Speaker 1: It's like I never even left your store, right, So
Speaker 1: they are essentially not paying you correctly for things that
Speaker 1: you haven't done correct and then they will you know,
Speaker 1: they call it deactivating you. They will deactivate you for
Speaker 1: late deliveries or for stuff that you can't get the
Speaker 1: livered because people don't answer their phones, or there's no
Speaker 1: safe place to leave it and you have to take
Speaker 1: it back to the location. But that's your fault because
Speaker 1: the customer was on cooperative. They call it deactivating. What
Speaker 1: does that mean? They don't gonna work with you again? Okay,
Speaker 1: So you get all of your stuff through an application.
Speaker 1: It's called Amazon Flex, and if they decide that they
Speaker 1: don't want you to work for them anymore, they de
Speaker 1: activate your account and you can't get worked. They'll send
Speaker 1: you an email that says you've been deactivated for such
Speaker 1: such a reason, and happy trails. So, as Bob just
Speaker 1: explained that if anything happens to the postle, even if
Speaker 1: it's not the driver's fault, they will get penalized for
Speaker 1: it and maybe even deactivated. What an Orwellian term. Anyway,
Speaker 1: let's hear what Bob had to say about the tip
Speaker 1: stealing scandal at Amazon Flex. Drivers. Amazon, we're taking tips
Speaker 1: from drivers and using those tips to make the other
Speaker 1: drivers wages a little better. So they weren't actually us
Speaker 1: the tips that we were getting. They were they were
Speaker 1: dispersing the tips elsewhere. I mean, I had only worked
Speaker 1: for Amazon for six months at that point, and I
Speaker 1: got a seven page or check from the FTC because
Speaker 1: that's how much they had taken out of my tips.
Speaker 1: I know drivers that got seventeen thousand dollar checks because
Speaker 1: Amazon was stealing that much of their income. Imagine that
Speaker 1: your own employer is stealing tens of thousands of dollars
Speaker 1: from you when they're already one of the richest companies
Speaker 1: on Earth. That's Amazon for you. The FTC dispersed sixty
Speaker 1: eight million dollars of funds drivers. I still think they're
Speaker 1: honestly doing it. And the reason I say that is
Speaker 1: my my tips always come out as a round number.
Speaker 1: It's never like, you know, five dollars and seventeen cents.
Speaker 1: It's always five dollars or seven dollars. And you notice
Speaker 1: this because sometimes you only get one delivery on your
Speaker 1: block and you'll get a five dollar tip, but it's
Speaker 1: always round numbers or on a fifth descent. But it's never,
Speaker 1: you know, se cents or something like that. It's it's
Speaker 1: just a little kind of hanky, you know what I mean.
Speaker 1: Bob thinks Amazon is still possibly stealing from his tips.
Speaker 1: We don't know, we can't verify that, but that's Bob's hunch.
Speaker 1: There are other things that are bothering him as well.
Speaker 1: I've listened to this so like Amazon will. Most recently
Speaker 1: they have opened up what they call same day deliveries,
Speaker 1: so people will get their order within twenty four hours
Speaker 1: and it will come out of a central warehouse. And um,
Speaker 1: quite often they'll give you a four and a half
Speaker 1: hour block and they'll expect you to deliver upwards of
Speaker 1: fifty packages in their foin half hours, and quite often.
Speaker 1: I mean I've been doing delivery and dispatches stuff for
Speaker 1: twenty five years. I know this kind of work. So
Speaker 1: they are overloading us first of all, and then when
Speaker 1: you run over, you have to literally email and email
Speaker 1: and email and email to get over each payments from them,
Speaker 1: and half the time like they're like, well, we paid
Speaker 1: you for the block you've worked, and and you know
Speaker 1: you're not talking a lot of money, You're talking fifty bucks.
Speaker 1: But when it happens we after weekly, it adds up.
Speaker 1: So you're you're constantly fighting to get those little bits
Speaker 1: of money, and Amazon it's like, well, we paid you
Speaker 1: for the money or at the time it worked. And
Speaker 1: then if you have to take stuff back to the warehouse,
Speaker 1: like an undeliverable package or something that's damage or something,
Speaker 1: they're not going to pay you for that time either.
Speaker 1: So basically, what Bob is saying here is that there
Speaker 1: are parts of the Amazon Flex delivery driver role that
Speaker 1: you just have to fulfill. For example, if you have
Speaker 1: to take a parcel back to the warehouse, stuff like that,
Speaker 1: but they're not paying them for this time. Every single
Speaker 1: second that they're working on that job is time working
Speaker 1: under the Amazon Flex program. They should be paid for
Speaker 1: that every second. In my opinion, they're expecting you to
Speaker 1: drive across the city to deliver back to their warehouse
Speaker 1: and they are not going to pay. How does that
Speaker 1: make you feel? You know, you're working this, you're trying
Speaker 1: to make a living. How do you feel about all
Speaker 1: this kind of shitty? To be honest, I mean, you know,
Speaker 1: I do this work because I've had some physical injuries
Speaker 1: and I'm able to do this. There's other stuff that
Speaker 1: I can't do. I mean, I don't have a real
Speaker 1: cupe education or anything like that. So you know, and
Speaker 1: I live in an area that the prices have skyrocketed,
Speaker 1: so you know, this is the best that I can do.
Speaker 1: And you know, in some days it's just like it
Speaker 1: really feels like your noses to the grindstone, you know
Speaker 1: what I mean. I don't have any version of working.
Speaker 1: Some people might say, well, why why don't you just
Speaker 1: work somewhere else, you know, or you can be a
Speaker 1: contract you know, what would you say to that? They
Speaker 1: shut down Colorado almost completely during the pandemic, And this
Speaker 1: is one of the few ways that I can make money.
Speaker 1: And I mean there's other services out there that you
Speaker 1: can work through. You can do grump up or uber
Speaker 1: or left, but you know a lot of that depends
Speaker 1: on your vehicle size or the age of your vehicle
Speaker 1: and stuff like that, so there's constraints on that. Amazon
Speaker 1: doesn't really care what you're driving, as long as you
Speaker 1: can cram as much crap in your car as you
Speaker 1: can and deliver it. You know, they also of precedents
Speaker 1: to new drivers, so they'll you know, I've been doing
Speaker 1: this for three years. Um, I've got friends that have
Speaker 1: been doing it since the program started, and they'll hire,
Speaker 1: you know, fifty new drivers and give them all the
Speaker 1: work and let the drivers that have been doing it
Speaker 1: consistently for years sit there and start for a week.
Speaker 1: The kind of cherry on top of the cake is
Speaker 1: the support system that they have. We we don't have
Speaker 1: any way to actually talk to the people dispatching the runs.
Speaker 1: We have UM Driver's Support, which, you know, you you
Speaker 1: contact them through the app and you get a phone
Speaker 1: call back. And these people are untrained. They have no
Speaker 1: clue what we're actually trying to do. UM they don't
Speaker 1: even know that, you know. They're like, well, you can
Speaker 1: just deliver it later. It's like, well, I'm not being
Speaker 1: paid to deliver the package later. They're like, what do
Speaker 1: you mean. It's like, well, I'm thirty miles from home.
Speaker 1: I Am not going to go home and try and
Speaker 1: deliver someone's package in two hours. I'm not being paid
Speaker 1: for that, you know. And on top of that is
Speaker 1: the time the gas and everything else. No, I mean,
Speaker 1: either the people get their package or it goes back
Speaker 1: to the world. It's a binary solution set on that
Speaker 1: because they're not going to give us any additional money
Speaker 1: to hang out to make sure that their packages are
Speaker 1: delivered um and then they're like, well, if you have
Speaker 1: a problem with that, email ourproath support. So hopefully after
Speaker 1: listening to Bob there, you realize that next time you
Speaker 1: want to get really angry with your Amazon delivery driver
Speaker 1: or whoever else's probably not their fault. As we've just heard,
Speaker 1: Amazon and not supplying them with the proper infrastructure they need,
Speaker 1: they're not paying them properly, and as we heard at
Speaker 1: the top of the episode, they were literally stealing money
Speaker 1: from them. The delivery driver is not the enemy, I
Speaker 1: promise you. Next week is the final episode of Megacorp,
Speaker 1: will be taking a look back over everything we've learned
Speaker 1: in this series. Megacorp is made by my production company
Speaker 1: H eleven for Cool Zone Media, Written, researched and produced
Speaker 1: by myself, Jake Hanrahan. It was also produced by Sophie Lichtman.
Speaker 1: Music is by Some Black, graphics by Adam Doyle and
Speaker 1: sound engineering by Splicing Block. If you want to get
Speaker 1: in touch, follow me on social media at Jake Underscore Hanrahan.
Speaker 1: That's h A N A A h A N