Handy Agrees to Settlement Over Misleading Earnings Claims
The popular gig app Handy, known for connecting customers with cleaners and handymen, is under scrutiny by the FTC and New York’s attorney general. They accused Handy of making misleading claims about potential earnings for its workers. In a recent complaint filed in the U.S. District Court for the Southern District of New York, authorities stated that Handy’s advertised earnings “don’t reflect the reality for the overwhelming majority of workers on the platform.”
According to the complaint, Handy, a subsidiary of Angi (previously Angie’s List), did not clearly disclose various fees and fines, withholding millions from its workers. Despite settling, Handy did not admit any wrongdoing. Samuel Levine, director of the FTC’s bureau of consumer protection, critiqued Handy’s practices saying they used “inflated and false earnings claims to lure workers” and then deducted “inadequately disclosed fines and fees from their wages.”
- Handy marketed immediate payout options without mentioning fees or additional job requirements.
- The advertised pay rates were often only achievable by a small fraction of workers meeting difficult criteria.
- Many workers faced opaque fines, some even due to system errors.
For example, a system bug led to improper job cancellations, resulting in $50 fines for thousands of workers unless they took specific steps like enabling GPS permissions and waiting over 30 minutes at job sites.
“Fees can be especially punishing for gig workers like those who rely on Handy as a primary source of income,” noted a 2022 survey by the Economic Policy Institute.
{Economic Policy Institute Survey 2022}
The survey revealed that 14% of gig workers earned less than the federal minimum wage, with many facing food insecurity and utility payment challenges. Handy itself acknowledged that many of its workers depend on public assistance or public housing.
As part of the settlement with the FTC and NY attorney general, Handy will pay $2.95 million to refund affected workers. The company must also substantiate its earnings claims and clarify fee avoidance methods. In their statement, Handy expressed readiness to litigate but chose settlement to refocus on supporting its customer base: “None of the agencies’ allegations were fair, and this settlement should in no way be construed as a validation of their allegations,” a spokesperson told TechCrunch.
While Handy aims to move forward from this legal challenge, it serves as a reminder of the importance of transparency and fairness in gig economy platforms.
