Walmart’s Spark Delivery Program Under Fire in $100M FTC Settlement

Walmart has agreed to a settlement with the Federal Trade Commission (FTC) and 11 states, totaling up to $100 million, due to allegations of deceptive practices regarding its Spark delivery program. The FTC alleged that Walmart misrepresented potential earnings to drivers, showing inflated base pay and tip amounts, and in some cases, did not pass on the full amount of customer tips. The settlement includes $79 million in direct compensation to drivers, a $16.2 million driver fund, $11 million in civil penalties to the states, and $10 million to the FTC for restitution.

According to the complaint, Walmart was aware of these issues through customer complaints, internal audits, and social media feedback, but continued the practices. Drivers were sometimes shown one offer, only to have the order split or changed after acceptance, resulting in lower pay. The FTC also stated that Walmart internally recognized issues with tips not reaching drivers as a significant defect in the Spark program.

As part of the settlement, Walmart is required to implement an earnings verification program and is prohibited from modifying initial pay offers except in limited circumstances. The company must also submit annual reports to the FTC for the next ten years to ensure driver compensation transparency. The Spark program, launched in 2018, has facilitated 355 million deliveries from over 4,200 Walmart stores.

(Source：Sourcing Journal)