Amazon is to settle a dispute with delivery drivers which could cost millions of pounds

The suit could cost the online retailer £140m, according to lawyers involved in the case which The Guardian first reported.

Drivers who deliver for Amazon via its “delivery service partners” (DSPs) are labelled as self-employed and therefore don’t have an employment contract.

This means they also don’t have access to benefits including holiday pay and the minimum wage.

Law firm Leigh Day first brought a claim against Amazon and its DSPs in 2021 with the argument that around 3,000 drivers were entitled to an average of £10,500 in compensation for each year they had worked for Amazon.

The claim was brought forward on the basis that drivers’ working conditions are dictated by Amazon, meaning they should have more employment rights.

Drivers told the law firm that the app gives them estimated travel times between deliveries, which they are required to meet. They are also not able to return parcels to the Amazon depot and have to use extra fuel to deliver packages at the end of each day.

The group of drivers have said after paying vehicle and rental insurance, they are left with little earnings.

It is not reported how many drivers have received settlement offers or how much this will end up costing Amazon and its DSPs, but Leigh Day said the group of drivers could be owed a total of £140m.

Drivers represented by the firm in an employment tribunal have received settlement offers paid for by Amazon and its DSPs.

Drivers are expected to receive their compensation after Christmas, with some payouts worth tens of thousands of pounds.

The acceptance of the settlement offer means drivers can’t make any further claims against Amazon, and Leigh Day declined to comment on any details.