, 28% of gig workers cited lack of access to job opportunities as a major reason for engaging in gig work.
For consumers, gig-economy platforms have served as a critical lifeline during the pandemic and have extended access to services such as reliable short-term housing, transportation on demand, and in areas lacking traditional options, home delivery of meals and other goods and services that have traditionally been hard to find and inconvenient to use.
The FTC’s statutory mandate to root out “unfair or deceptive practices” is not a freewheeling license to regulate all aspects of the economy. By law, the FTC’s unfairness authority may be deployed only when conduct causes substantial injury to consumers. The policy statement that Khan’s FTC issued contemplates a far more invasive, wholesale intervention into the labor relations between gig workers and platforms, virtually ignoring the effect on consumers.
Thus, the classification of workers as independent contractors is deemed “misclassification” even though it is in compliance with existinglaws. Arbitration clauses and take-it-or-leave-it contract terms, which are widely used throughout the economy, are labeled as “lopsided” by the FTC. The use of algorithms to determine compensation — a fundamental and essential feature of many gig-work platforms — is characterized as an example of “power imbalances.