Walmart, Branch Messenger Accused Of Using Illegal Payment Practices With Delivery Drivers

You can't play with people's money.

Walmart and work scheduling platform Branch Messenger are being sued by the Consumer Financial Protection Bureau (CFPB) over accusations of employing illegal payment practices with delivery drivers, the Associated Press reports.

The retail giant and scheduling platform allegedly forced drivers participating in the company’s gig program, Spark, to use deposit accounts to secure payment and misrepresented the ways to gain access to their wages. The Spark program uses gig workers who make deliveries from Walmart stores across the country for “last mile” deliveries. The bureau alleges the practice dates back to 2021, prompting Walmart and Branch, a financial technology company that offers deposit accounts at Evolve Bank & Trust, to violate federal law by forcing one million drivers that use the program to use Branch in order to get paid and claim they would fire workers who didn’t.

The alleged practice cost workers over $10 million in fees.

The companies also face allegations of misleading workers about having same-day access to their earnings. CFPB alleges the drivers had to follow a complicated process in order to see their funds, and once completed, drivers experienced more delays, on top of fees, given a need to transfer the money they earned into a chosen account.

In a statement, agency director Rohit Chopra said Walmart took advantage of their employees. “Walmart made false promises, illegally opened accounts, and took advantage of more than a million delivery drivers,” Chopra said.

“Companies cannot force workers into getting paid through accounts that drain their earnings with junk fees.”

However, both companies pushed back on the allegations.

“The CFPB’s rushed lawsuit is riddled with factual errors and contains exaggerations and blatant misstatements of settled principles of law,” the Bentonville, Arkansas-based company said in a statement, according to CBS News. “The CFPB never allowed Walmart a fair opportunity to present its case during their rushed investigation.”

Branch shared similar sentiments, saying the agency’s suit “includes intentional omissions” to cover what they called an “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 company’s statement read.

CFPB has been taking a look at other companies accused of illegal business practices involving their employees or customers. In May 2024, a suit was filed against SoLo Funds, a fellow Evolve partner, alleging that it deceived borrowers on the total costs of loans. The Federal Reserve got involved by enforcing action against Evolve after an investigation found it failed to police its fintech partners properly.