Walmart agrees to $100M settlement over deceptive pay practices in Spark Driver program | TechCrunch

TechCrunch

by Sarah Perez

February 26, 2026

AI-Generated Deep Dive Summary

Walmart has agreed to settle a lawsuit brought by the Federal Trade Commission (FTC) over deceptive pay practices in its Spark Driver program, which uses gig workers to deliver online orders. The retail giant will pay $100 million to resolve claims that it misled drivers about their potential earnings, including base pay and tips. Customers were falsely told that 100% of tips went directly to drivers, while the company engaged in practices like splitting tips among multiple drivers without notification or misrepresenting tip guarantees. These actions allegedly caused drivers to lose millions in promised income and led to thousands of consumer complaints. The lawsuit, filed by the FTC along with 11 states, accused Walmart of several deceptive tactics since 2021. For instance, the company often split customer orders between drivers, leading to divided tips, while falsely claiming that a single driver would receive the full tip. Additionally, Walmart failed to inform drivers when tips were removed from batched orders and promised tips in advance without ensuring they were collected. Drivers also faced unexpected reductions in base pay after accepting offers, and incentives were misrepresented as guaranteed earnings. Under the settlement, Walmart is required to implement an earnings verification program to ensure drivers are paid the promised amounts. The company is banned from adjusting base pay, incentives, or tips unless a driver fails to provide service or a customer cancels an order. This move aims to restore trust in the gig economy by ensuring transparency and fairness in compensation practices. The case highlights the importance of truthful communication in labor markets, particularly within the tech-driven gig economy. The FTC emphasized that accurate information about earnings and terms is essential for workers to make informed decisions. By holding companies accountable for deceptive practices, regulators are helping to create a more equitable and sustainable gig workforce. This settlement sends a clear message that misrepresentation of earnings will not be tolerated, potentially influencing other platforms to adopt similar safeguards. For tech enthusiasts and startup observers, this ruling underscores the growing scrutiny of gig economy practices. As platforms increasingly rely on independent contractors for services like delivery, transparency in pay structures and terms of employment becomes critical

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Originally published on TechCrunch on 2/26/2026