The Dark Side of Fitness App Development: Uncovering Algorithmic Wage Discrimination

Algorithmic wage discrimination is more than just a buzzword in the gig economy. It's a reality that affects millions of workers worldwide, including those in the fitness industry. In this article, we'll delve into the world of algorithmic wage discrimination and explore its impact on workers, industries, and society as a whole.

The Rise of Algorithmic Wage Discrimination

In recent years, the use of granular data to produce unpredictable, variable, and personalized hourly pay has become increasingly common. This phenomenon, known as algorithmic wage discrimination, involves the use of complex algorithms that are not always transparent or disclosed. When these algorithms are not made public, they're referred to as "black box" algorithms, making it difficult for workers to understand how their interactions with a platform affect their pay.

The Gig Economy and Beyond

The gig economy has seen a significant rise in algorithmic wage discrimination, particularly among freelance workers and independent contractors. According to Upwork, there were 64 million freelancers in the US workforce as of 2023, representing 38 percent of the total workforce. McKinsey found that 36 percent of employed survey takers identify as independent workers, extrapolated to 58 million Americans.

One example is Shipt, a delivery service acquired by Target in 2017. In 2020, Shipt introduced an algorithmic payment system that left workers uncertain about their wages. The company claimed this new approach was fairer and better matched pay to labor required for orders, but many workers saw their paychecks dwindling.

Beyond Gig Work

Algorithmic wage discrimination is not limited to the gig economy. Wilneida Negrón, director of policy and research at Coworker.org, notes that similar concerns exist in industries such as home health care, retail/manufacturing, transportation, and logistics. Workers for Instacart, Uber-owned Postmates, GoPuff, Favor, and Rover have all expressed concern about algorithmic wage discrimination.

The Banking and Finance Industries

The banking and finance sectors are also affected by algorithmic wage discrimination. Negrón notes that workers at Wells Fargo and HSBC have objected to the use of algorithmic performance and productivity measurements that indirectly affect compensation and promotion.

Addressing the Issue

To address algorithmic wage discrimination, labor advocates like Coworker.org are calling for minimum wage guarantees or fair pay standards in industries where these practices are common. Additionally, there is a growing need for algorithmic transparency, with workers demanding regular reporting standards that require companies to regularly report pay data and identify disparities caused by algorithmic decisions.

The Role of Legislation

There is some irony in seeking legislation to address algorithmic wage discrimination, given state laws like California's Proposition 22, which helped make the situation worse. However, the current US administration has signaled its willingness to push back on industry efforts to treat gig workers as independent contractors.