The University of California at Los Angeles paid at least 15 graduate and undergraduate student employees with Amazon gift cards after it discovered an error in tax deductions created by its payroll system on November 20.
"The University of California's central payroll office (UCPath) recently discovered an error in OASDI and Medicare withholding for some employees," a letter received by the UCLA students from the University of California's payroll office on November 20 said. "To reimburse you for your overpayment in taxes, we are enclosing a $10.00 gift card."
The issuing of Amazon gift cards as a form of compensation points to the increased privatization of the University of California, which has more than 234,000 employees on payroll. The student workers did not get a cash reimbursement in addition to the gift card.
“The University of California's central payroll office recently discovered an error in tax withholding for some student workers during a portion of 2019. For those cases where the error was greater than $10, the university issued a check for the correct amount,” Katherine Alvarado, a spokesperson for UCLA, said. “For those cases where the error was $10 or less, with the average amount over-withheld being $4.36.”
Concerned UCLA student workers and their union UAW Local 2865 are already filing a grievance as students worry that UCLA and other universities on the UCPath payroll system could continue to rely on Amazon gift cards for payment or reimbursement for larger amounts. Getting paid in Amazon gift cards allows the university to dictate where workers spend their earnings and would make it more difficult for struggling students to pay for basic necessities like rent.
"I think giving us Amazon gift cards is ridiculous," said Kyle Scott, a PhD student in philosophy at UCLA who received a $10 Amazon gift card as a form of payment from UCLA last week. "For one thing you can’t pay for utilities and rent with an Amazon gift card, which is my most pressing financial need. I also never agreed to work for gift cards. I work for money. It seems dangerously close to a company store style exchange as though I agreed to work for credit to spend as UCLA dictates rather than money I could spend as I see fit."
This isn't the first time the University of California has paid students with Amazon gift cards. Another graduate student at University of California Berkeley provided email documentation showing that a professor they worked for in 2019 offered to compensate them with a $599 Amazon gift card.
"I can't ever imagine buying that much crap on Amazon and don't actively use [Amazon]," the PhD student who wished to remain anonymous because they feared retaliation from the university, said. "I complained and eventually they issued a Visa gift card, but I got the sense from the professor that Amazon gift cards were their preferred method of payment."
Motherboard also reviewed email documentation showing that the University of California and UCLA regularly ask students to complete surveys in exchange for up to $500 in Amazon gift card credit. Students have also been solicited to participate in UCLA behavioral research studies paid by the hour in the form of either an Amazon gift card or a UCLA campus card that can be used for food, laundry, and textbook purchases at UCLA or pre-approved businesses.
The UCLA spokesperson told Motherboard that UCLA does not have a contract with Amazon and that the “gift cards were purchased for the same amount as their face value.”
While there's no evidence that Amazon has struck a deal with the University of California or any of its campuses related specifically to gift cards, Amazon Web Services does have contracts with UC campuses and since 2016, Amazon has run a study space and locker on the UC Berkeley campus. As part of their contract, Amazon can seek to block the release of public records or redact parts of them related to their operations at UC Berkeley.
"Thankfully the over deducted amount was small and gift cards and being paid out as reimbursements, but this is a bad precedent to see," said Ethan Hill, recording secretary at UAW Local 2865 at UCLA. "We’re filing a grievance because we can't allow the UC to keep paying out workers in Amazon gift cards. That’s not what we negotiated over in our contact. It’s unacceptable."
In recent years, hundreds of University of California employees have reported pay errors, including reduced or missed paycheck deposits with UC Path, the payroll system which the University of California completed in 2020 at the cost of nearly $1 billion, according to a California state auditor. Some students say missing and late payments have forced those living paycheck-to-paycheck to face financial hardship.
"There are so many issues with UC's payroll system. I often wonder whether there’s an intentionality that they make it difficult for you to access your money," the PhD student who wished to remain anonymous, said. "If we were treated as normal employees, we wouldn’t [be paid with Amazon gift cards] or have to spend months trying to figure out where our money is."
This story has been updated with a comment from UCLA.