Sometimes, a “scandal” comes along that leaves you underwhelmed. In my case, I have struggled to muster much outrage over complaints that “dynamic pricing” algorithms push up the price of items such as pop concert tickets when demand is high. The notion that prices might rise when demand outstrips supply doesn’t strike me as particularly outlandish. It’s just that, these days, companies have much more data at their disposal to gauge demand and supply in real time, and in a world of ecommerce, a much easier way to change prices quickly in response.
But what if you took that logic, and applied it to wages? What if you couldn’t predict how much you would be paid each day, regardless of the hours you put in or the performance you achieved, because your pay rate would be varied by an algorithm, based on a range of factors you couldn’t necessarily control?
This is not a hypothetical scenario. Over the past few years, a number of gig economy companies in the ride-hailing and food-delivery sectors have implemented algorithmically determined dynamic pay for the workers on their platforms. This means that rather than earning a fee per task based on a predictable formula (such as time or distance), they are now offered a bespoke fee for each task, which they must quickly decide whether to accept or reject in their app.