Amazon Slapped With Class Action Wage Theft Suit

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Amazon Slapped With Class Action Wage Theft Suit

Nicole Knight

The online shopping giant faces claims that it cheated workers of wages, overtime, and employment protections.

Amazon is the latest company to face allegations of wage theft, as workers nationwide have increasingly demanded fair compensation in courthouses and demonstrations.

The online shopping giant faces claims that it cheated workers of wages, overtime, and employment protections. A class action lawsuit filed October 27 in Los Angeles Superior Court accuses the online retailer of misclassifying workers as independent contractors, among other violations.

Drivers for Amazon claim in the court filing that they wear Amazon Prime Now uniforms and report to Amazon’s warehouse, but are denied the benefits and protections of California employment law.

California affords workers some of the strongest wage protections in the country, and a law signed by the governor in October adds teeth to those measures by permitting the state labor commissioner to place a lien on the property of an employer cited for wage theft and by subjecting violators to imprisonment and fines.

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The Amazon suit was brought by Oakland-based Leonard Carder LLP on behalf of four drivers employed by an Amazon subcontractor, Scoobeez, for the online retailer’s newly launched instant delivery service, Amazon Prime Now.

The drivers claim in the filing they must cover gas and other expenses out of pocket and use their own vehicles as they deliver packages within Amazon’s one- and two-hour delivery window. They are paid $11 per hour, but these un-reimbursed expenses, they allege, mean their net earnings fall short of the minimum wage. And although the Amazon Prime Now app suggests a default tip of $5, drivers claim they have not received these tips.

In a statement October 30, Amazon said it requires its subcontractors “to abide by applicable law, follow our supplier code of conduct and disburse tips given by customers to their drivers. We audit and investigate claims that any provider isn’t complying with these obligations.”

The suit seeks an unspecified amount of back wages, restitution, and compensation for attorney fees, among other damages.

This latest court action comes on the heels of a landmark class action settlement this summer in favor of FedEx delivery drivers with similar complaints. The settlement ordered the delivery company to pay $228 million to more than 2,300 California delivery drivers, as the San Francisco Business Times reported, making it one of the largest settlements of its kind.

The attorney who won that settlement is now taking Amazon to court.

“The facts in this case are much stronger than in the FedEx case, and we won,” Beth Ross, the attorney representing the drivers, told the Business Times. “These are low-wage workers who have no other options, otherwise they wouldn’t be doing this.”

Research suggests that workers in the low-paying service industry are often subject to wage theft. Cases centering on these workers have drawn the attention of labor unions and lawmakers across the country of late.

Rewire reported in February that a New York judge ordered a Papa John’s pizza franchise to pay its workers nearly $800,000 in unpaid wages after New York Attorney General Eric Schneiderman filed suit against the franchise operator.

A class action suit filed in federal court in San Francisco on behalf of drivers for the ride-hailing app Uber argues they are misclassified as independent contractors and thus denied employment protections, as Reuters reported.

A study of 2008 data released by the National Employment Law Project, the UCLA Institute for Research on Labor and Employment, and the Center on Urban Economic Development found that of workers in low-wage industries in Chicago, Los Angeles, and New York City, 26 percent were paid less than the legally required minimum wage, and three out of four employees who worked more than 40 hours a week were not legally compensated for their overtime hours. Six in ten of low-wage industry workers were underpaid by more than $1 per hour.