FTC accuses gig program Work Handy of false advertising and worker fees

The FTC and the New York Attorney General said the accused Helpfulclients of the gig program can use it to book cleaners, handymen, and more, making fraudulent claims about the number of workers they can find through its platform.

In a complaint filed Tuesday in the US District Court for the Southern District of New York, the FTC’s attorney general and NY said Handy, which was owned by Angie’s (formerly Angie’s List), announced earnings that “do not reflect the reality due to the large number of employees. platform work.” Handy also failed to disclose fines and fees, the complaint says, resulting in millions of dollars being withheld from employees.

Handy has accepted the settlement – but not admitted any wrongdoing.

“(Handy) relied on fake earnings and money to lure employees to the platform,” Samuel Levine, director of the FTC’s office of consumer protection, said in a statement. “Then they deducted fines and fines from their paychecks.”

According to the complaint, Handy sold his platform as a means of earning immediate employment. But its ads didn’t mention that employees had to pay — and in some cases, complete a job — to unlock the fast-paying accounts. (By default, it takes about a week to pay for the Help service.)

Handy also set unrealistic financial expectations, the FTC and NY attorney general say. In New York, New Jersey, and California, the program’s ads pay only to the highest-paid workers, which are required to meet the requirements. In some markets, Handy announced it was paying manual and furniture workers up to $45 an hour, even though more than 90% of workers on the platform took the cut, according to the complaint.

In addition, Handy charged many employees with fines, the FTC and the NY attorney general said — including fines that were issued without cause to the employees. According to the complaint, a flaw in Handy’s system caused thousands of workers to be fined $50. Employees can avoid that fine if they take steps including giving GPS permission to the Handy app and waiting more than 30 minutes for work.

The fees can be particularly punitive for gig workers like those who rely on Handy as their main source of income. In 2022 research by the nonprofit Economic Policy Institute, 14% of gig workers reported earning less than the federal minimum wage. One in five said they were hungry because they did not have enough food; almost a third did not pay the full amount of aid in the month before the survey.

Handy himself has admitted that many of his workers are supported by the public or live in public housing, according to to FTC reporters.

In a settlement between the FTC and the NY attorney general, Handy paid $2.95 million to compensate workers who were injured by the platform’s practices. Handy also has to verify the claims about the number of workers it can get, and make sure the workers can avoid fines.

In a statement, Handy said he agreed with the content.

“Although we were ready to litigate, we decided to enter into an agreement with these parties to put the matter to rest and to refocus our attention 100% on supporting our customers: small businesses that help Americans manage and maintain their homes. , “The spokesman told TechCrunch. “None of these organizations’ claims were accurate, and this determination should not be construed as a vindication of their claims.”