FTC Takes Aim At Companies Deceiving and Exploiting Gig Workers

Gig workers have been driving passengers around, shopping for goods and delivering dinners for years, often putting their safety at risk without getting the benefits of full-time employees. Now, the Federal Trade Commission has clarified its policies for companies in the so-called gig economy that deceive and exploit their workers. 

“Protecting these workers from unfair, deceptive and anticompetitive practices is a priority, and the Federal Trade Commission will use its full authority to do so,” the FTC’s blog post said about its clarified policies for the gig economy, which is expected to generate $455 billion in annual sales next year. 

The FTC explicitly outlined bad company actions in its 17-page policy statement, like how restrictive and nonnegotiable contracts may harm workers by stifling free speech or keep them from seeking new work while employed, which could violate Section 5 of the FTC Act. The commission also put the gig industry on notice that it will investigate any sign of backdoor agreements between companies to fix wages or other forms of anticompetitive action. 

Companies employing gig workers at a massive scale like Uber and Lyft have proposed statewide initiatives to prevent their contract workers from becoming full employees with benefits, including the 2020 Proposition 22 in California, which voters approved. Despite a judge ruling the proposition unconstitutional, it remains in effect as appeals run their course.

Uber and Lyft didn’t immediately respond to a request for comment.

Read more: Best Tax Software for Self-Employed in 2022: File Late Taxes Now, or Estimate Quarterly Taxes

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