Craig Ruttle/AP Photo
- The Strategic Organizing Center, a coalition of labor unions, filed an FTC complaint against Amazon.
- The filing alleges Amazon has failed to properly disclose advertisements in its search engine results.
- An Amazon spokesperson told Insider the complaint is “incorrect and misstates FTC guidance.”
Amazon is once again clashing with labor unions, this time over allegations of deceptive advertising practices.
The e-commerce giant is the subject of a new complaint filed with the Federal Trade Commission on Wednesday, alleging the company is “unlawfully deceiving millions of consumers” by failing to disclose advertisements in its search results.
The complaint — which was filed by the Strategic Organizing Center (SOC), a coalition of four labor unions representing a total of four million workers across an array of industries — claims that Amazon violated federal disclosure regulations that call for visual identification of advertisements in search engine results.
“SOC has found evidence that Amazon is systematically flouting FTC guidance for such disclosures, and in addition is deliberately obfuscating identification of a key category of advertisements by delaying their ad labels from loading for several seconds,” SOC wrote in the filing.
The evidence includes an analysis of 130,000 product search results in which the SOC claims that an “overwhelming proportion of advertisements” aren’t distinguishable from organic search results — an oversight that the coalition writes “throws into question the fundamental integrity of ‘search’ on Amazon’s online platform.”
In a statement, an Amazon spokesperson told Insider the complaint is “incorrect and misstates FTC guidance,” adding that advertisements featured on the site “always include a clear and prominent ‘sponsored’ label in accordance with FTC guidelines.
“We design our store to help customers discover products we think may best meet their needs – sponsored ads is one of the ways to help them find products they may be interested in,” the spokesperson wrote in a statement.
Under current FTC regulation, sponsored ads must be identified using any method, “so long as it is noticeable and understandable to consumers.” A representative for the FTC declined Insider’s request to comment on the matter, as per the organization’s policy.
The filing comes after SOC published a report last month about Amazon operations during the pandemic, alleging the e-commerce giant prioritized “production to maximize profits while vigorously resisting efforts by authorities to monitor and regulate COVID-19 safety in its operations.”
It also comes on the heels of multiple allegations of union-busting practices at Amazon, as warehouse workers around the country started organizing during the pandemic.
In August, the National Labor Relations Board (NLRB) ruled that the company illegally interfered in a union vote at a warehouse in Alabama. Just days later, a report from Vice found that the NLRB had also charged the company with breaking labor law by preventing a Staten Island employee from handing out pro-union leaflets.
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