Federal Agency Takes Aim at Walmart’s Gig Program
The Consumer Financial Protection Bureau (CFPB) has filed a lawsuit against retail giant Walmart and its partner, Branch Messenger, alleging that they misled and exploited delivery drivers in their gig program. The lawsuit claims that Walmart and Branch forced drivers to use costly deposit accounts to receive payment, resulting in over $10 million in fees.
Forcing Drivers into Costly Accounts
According to the CFPB, Walmart and Branch violated federal law by requiring drivers in their Spark program to use Branch’s services to get paid. The agency alleges that drivers were told they would be terminated if they didn’t comply. This practice, which lasted for approximately two years starting in 2021, affected over 1 million drivers.
Misleading Drivers About Access to Earnings
The CFPB also accuses Walmart and Branch of misrepresenting how drivers could access their wages. While promising same-day access, the companies allegedly made drivers jump through hoops to get their money, only to face further delays or fees when transferring funds to their preferred accounts.
A Pattern of Deception
“Walmart made false promises, illegally opened accounts, and took advantage of more than a million delivery drivers,” said CFPB Director Rohit Chopra. “Companies cannot force workers into getting paid through accounts that drain their earnings with junk fees.”
Walmart and Branch Push Back
In response to the lawsuit, a Walmart spokesperson called the allegations “rushed” and “riddled with factual errors.” Branch Messenger also disputed the claims, stating that the CFPB misstated the law and facts, and omitted key details to justify their overreach. Both companies vow to vigorously defend themselves in court.
A Warning to Companies
The lawsuit serves as a warning to companies that exploit workers through unfair practices. As the gig economy continues to grow, it’s essential that companies prioritize transparency and fairness in their dealings with workers.
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