Gig Platform Arise Deceived Customers About the Potential Earnings, Says FTC

(PatriotPostNews.com) — The Federal Trade Commission is cracking down on online gig platforms. Gig jobs are generally low-skilled freelance jobs like Instacart shopper or Uber driver. Gigs allow workers flexibility, but lack the protections of traditional employment. The FTC is reexamining what protections gig workers are entitled to. The FTC alleges the major online gig platform, Arise Virtual Solutions, severely misled users.

In a statement, the FTC alleged that Arise promised higher pay rates than were reasonably achievable from the platform. It also asserted that Arise forced workers to spend large sums on training, but said the majority of workers were denied positions after completing training. The FTC alleges that Arise did not appropriately disclose earning potential.

Arise promised $18 an hour after training. In major cities like Philadelphia, gig workers can expect to earn an average of $17 an on gig work. True earnings from the Arise gigs averaged $12 an hour. In the statement, the FTC asserted that platforms operating in the gig economy are not above the law and promised to use all available resources to protect Americans from hostile gig platforms.

Average monthly income among gig workers is extremely hard to calculate. Studies put average monthly income for gig workers as low as $800, but show it could be as high as $11,000 a month. Roughly 35% of Americans identify as “independent workers.”

New York City and California state are taking steps to protect gig workers. California proposed granting gig workers similar rights as independent contractors. NYC moved to mandate a minimum wage for all gig workers, but major gig platforms including DoorDash and Uber sued the city and blocked the mandate.

Arise Virtual Solutions agreed to a $7 million settlement to be distributed to Arise users. In a statement, the company denied all allegations and insisted that the settlement is not an admission of guilt. Massachusetts’ law firm, Lichten & Liss-Riordan asserted that $7 million is not a severe enough punishment.