FTC promises action against companies that take advantage of gig workers

The Federal Trade Commission has outlined a new plan to hold gig companies accountable for taking advantage of their employees.

In a 17-page policy statement released Thursday, the FTC highlighted the many challenges facing gig workers, including cheating about pay and hours, unfair contract terms, and non-competitive wage fixation and coordination between gig companies.

“No matter how gig companies classify them, gig employees are entitled to protection under the laws we apply,” Samuel Levine, director of the FTC’s Bureau of Consumer Protection, said in a statement. “We are fully committed to our consumer protection and competition enforcement efforts within the FTC, as well as working with other agencies across the government to ensure that gig workers are treated fairly.”

A worker rides a bicycle to his job at a food delivery service in Kawasaki, south of Tokyo. (Reuters/Kim Kyung-hoon)

The Flex Association, a trade group that represents Uber, Lyft, DoorDash, Instacart, Grubhub, Gopuff, HopSkipDrive and Shipt, was present during the FTC’s 3-2 vote on Thursday to adopt the policy statement. The trade group told Fox Business that it welcomes “open dialogue” with the FTC to share insights that its members can support to app-based earners and their communities.

Flex CEO Kristin Sharp told Fox Business in a statement: “During yesterday’s meeting, we called on activists and advocacy groups to emphasize how app-based work provides the flexibility and freedom that millions of people live with on their own terms. can earn extra income.” “What is missing from the FTC’s policy statement is the perspective of the workers the agency seeks to protect.”

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Citing data from the Federal Reserve and the agency’s Serving Communities of Color report, the policy statement said 16% of Americans are making money through an online gig platform and 30% of Latino adults, 20% of black adults and 19. % Asians engaged in adult gig work compared to 12% of white adults.

A 2019 study by Mastercard previously estimated that the gig economy could generate $455 billion in annual sales by 2023.

ftc building

The Federal Trade Commission has outlined a new plan to catch gig economy companies that take advantage of their employees. (Paul J. Richards / AFP via Getty Images / Getty Images)

To hold gig companies accountable, the agency says it will investigate potentially inappropriate words imposed on gig workers, including non-compete clauses, liquidated damage clauses and nondisclosure agreements.

It will also examine evidence of agreements between gig companies to settle wages, benefits, fees or other conditions relating to gig work that may be subject to competition, as well as evidence of non-hunting agreements and agreements that are competitively sensitive. share information that may suppress compensation for workers.

In addition, Consumer Sentinel will review and, as appropriate, challenge mergers and other combinations of gig companies that may significantly reduce competition between or between gig companies and prevent any exclusions or violent conduct by major firms. Investigators who may illegally create or maintain a monopoly or monopoly. Monopony resulting in low compensation or poor working conditions for gig workers. A monopsony is a major buyer or employer.

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The FTC has already initiated rulemaking proceedings to strengthen its ability to detect and prevent misleading earnings claims and has sought comment on the prevalence of misleading earnings claims related to gig work.

Last year, it served notice to more than 1,100 companies that could impose significant civil penalties — up to $43,792 per violation — if they or their representatives claim to lure participants to money-making opportunities that are unfair or deceptive. and take action in violation of the FTC.

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In addition to enforcing existing consumer protection and competition laws, the FTC says it is addressing issues in the gig economy in collaboration with agencies such as the Justice Department and the National Labor Relations Board.

The agency is also focusing resources to assist the Bureau of Consumer Protection staff in assessing whether certain communities are affected by or targeted by unfair or deceptive practices, including the gig economy, and consumer and labor groups, industry. and seeking inputs from experts facing challenges. Gig workers through monthly open commission meetings and targeted workshops.

A DoorDash delivery worker drives his bike on the side of the road in the Mission neighborhood of San Francisco, California.

Although the policy statement did not call out any specific gig companies, it noted that they “touch almost every aspect of American life, from food delivery to transportation to home services.”

Companies that have contributed to the growth of the gig economy include Uber, Lyft, DoorDash, GrubHub and Instacart.

anchor Security The last Change Change %
Uber Uber Technologies Inc. 31.70 -1.43 -4.30%
lift Life Inc. 16.35 -0.64 -3.77%
dash Doordarshan Inc. 59.98 -4.43 -6.88%
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