Some initial thoughts on the Otey vs. CrowdFlower case
January 9, 2013
The question of whether paid crowd work violates U.S. employment and minimum wage laws may finally make it into court thanks to Christopher Otey, an Oregon resident who is suing CrowdFlower Inc. for wages he claims the company owes him as an “employee.”
I have a few preliminary, and mostly mixed, feelings about this. However, I should preface everything by saying that (1) I have known one of the defendants named in the suit, CrowdFlower CEO Lukas Biewald, for many years through mutual acquaintances at Stanford, where we were both enrolled at the same time; and (2) I worked as a paid, independent consultant with CrowdFlower on several projects between 2008-2011. That said, I have never held, nor hold at this time, any material interest, financial or otherwise, in the company.
My initial reaction is that I can’t believe it’s taken this long for someone, somewhere in the United States to sue one of the companies engaged in distributing paid crowdsourcing work for violation of the Fair Labor Standards Act (FLSA). Smart lawyers like Alek Felstiner and Jonathan Zittrain have been making some form of the argument that this is a major issue for Crowdsourcing for at least three years now. Felstiner even made the case in a series of posts on CrowdFlower’s blog here, here, and here in 2010. I am hardly the only person to regard as remarkable the fact that a whole venture-funded industry has sprung up around a set of activities that, on the surface, seem to resemble a massive minimum wage violation scheme.
At the same time, there are a lot of reasons to believe that crowdsourcing represents a fundamentally different sort of phenomenon than the varieties of “work” and workplace abuses the US congress sought to regulate with the FLSA back in 1938. For starters, crowd work is radically flexible – in terms of time and location – as well as minimal in terms of the commitment, skill, and obligations required of workers. As a result, it’s not clear that the relationships established between requesters and providers of work in this context are really anything like relational contracts that exist between traditional employers and employees. Crowd workers do what they for a variety of reasons, in a variety of ways, and under a variety of conditions, making it pretty hard to determine whether they ought to be considered employees of the organizations that may play a role in compensating them for their efforts (and this is potentially an important point since CrowdFlower plays something of a middle-man role between the individuals and companies that post tasks to its site and those who complete the tasks and receive compensation in exchange for their labor).
One particular challenge posed by the suit and the fact that Otey and his attorneys have chosen to seek compensation under US minimum wage laws ($7.50 per hour). Depending on the outcome, the impact of a ruling against CrowdFlower could therefore make paid crowd work as it exists today financially impractical within the United States. While such a ruling might represent a crucial step in enforcing legal, ethical, and financial standards of fairness in online environments, it might also undermine the growth of a valuable source of future innovation, employment, research, and creativity. Crowd-based systems (whether paid or unpaid) of distributed information creation, processing, and distribution have accounted for some of the most incredible accomplishments in the short history of the Internet, including Wikipedia, ReCaptcha, Flickr, Threadless, Innocentive, Kiva, Kickstarter, YouTube, Twitter, and the Google search engine.
As some colleagues and I have argued in a forthcoming paper, The Future of Crowd Work, there are many ways in which paid crowd work as it exists today does not look like the kind of job you would necessarily want your child to take on as a career. And yet, while crowd work is very, very far from ideal by almost any standard, I would be disappointed if the impact of this case somehow resulted in the destruction of the industry and the stifling of the innovative research and applications that have developed around it. The outcome will boil down to the ways in which paid labor – even flexible, remote, and relatively straight-forward tasks that are paid only $0.01 – is regulated as compared with volunteer labor.