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The
agency alleged last week that for approximately two years
starting in 2021, Walmart and Branch violated federal law by
forcing 1 million drivers on its so-called Spark program to use
Branch to get paid and that they would terminate workers who
didn't want to use these accounts. Walmart's Spark program uses
gig workers who make deliveries from Walmart stores nationwide
on so-called “last mile” deliveries.
CFPB also claims that Walmart and Branch misled workers about
the availability of same-day access to their earnings. It said
that the drivers had to follow a complex process to access their
funds, and when they finally did, they faced further delays or
fees if they needed to transfer the money they earned into an
account of their choice.
The practice resulted in workers paying more than $10 million in
fees, the agency said.
“Walmart made false promises, illegally opened accounts, and
took advantage of more than a million delivery drivers,” said
CFPB Director Rohit Chopra in a statement released Dec. 23.
“Companies cannot force workers into getting paid through
accounts that drain their earnings with junk fees.”
In a statement emailed to The Associated Press on Friday, a
Walmart spokesperson called the lawsuit “rushed" and said it was
”riddled with factual errors and contains exaggerations and
blatant misstatements of settled principles of law. "
“The CFPB never allowed Walmart a fair opportunity to present
its case during their rushed investigation," the statement said.
“We look forward to vigorously defending the company before a
court that, unlike the CFPB, honors the due process of law.”
Branch, based in Minneapolis, said in an emailed statement to
The AP that it strongly disagrees with the lawsuit filed by the
CFPB, which Branch said misstates the law and facts, and
includes intentional omissions to mask the bureau’s clear
overreach.
“Branch has provided Walmart and their driver partners valuable
services allowing quick and easy access to funds via their
business accounts—a key fact the bureau’s press release omits,”
the statement said.
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