FTC Orders Delta, Walmart, Uber and Six Other Companies to Disclose How Personal Data Shapes Prices and Pay

The Federal Trade Commission has ordered nine companies to hand over detailed information about how they use personal data to set prices for customers and pay for workers. The orders, issued on October 28 under Section 6(b) of the FTC Act, went to Delta, United, JetBlue, Lyft, Uber, DoorDash, Instacart, Target, and Walmart.

The orders are part of a study, not an enforcement action, and the announcement does not establish that any company named broke the law. The companies must respond within 45 days of receiving the orders.

What the agency wants to see

The companies must document the formulas, software, and data used to adjust prices, assign jobs, and calculate pay. Most of the requests cover practices dating to January 1, 2023. The companies must also say which information varies by customer or worker, describe how their systems use it, explain when employees modify or override the results, and say where the information and pricing tools come from, including whether outside vendors supply them.

The orders also ask for the wording, location, and dates of explanations given to customers and workers about these practices. For consumers, the inquiry asks whether the methods raise or lower prices, expand access to products and services, or produce other benefits and costs. For gig workers, regulators want an accounting of how customer payments are divided between worker pay and company revenue, and how personal information affects which workers receive particular jobs.

“We intend to scrutinize the opaque methodology that some companies in these industries may be using to determine how much consumers pay or how much gig workers are paid for the same product or service,” FTC Chairman Andrew N. Ferguson said in the release. “Consumers deserve to know whether companies use their web surfing habits or other personal data to estimate the highest price they can charge each consumer. Workers also deserve to know if their compensation is affected by how companies use their personal data.”

How companies responded

Delta said in a statement to PYMNTS: “There is no fare product Delta has ever used, is testing or plans to use that targets customers with individualized offers based on personal data. We have zero tolerance for discriminatory or predatory pricing and fully comply with applicable privacy, pricing and advertising laws.”

Target pointed to an October 15 fact sheet in which the company told customers: “Target does not use your personal information to raise an item’s price. And we don’t adjust prices based on the time of day you’re shopping or during times of high demand.” JetBlue said it does not use personal information or web browsing history to set individual pricing, and that fares are set by demand and seat availability, with all customers having access to the same fares on its site and app.

Walmart has denied surveillance pricing plans in the past after a watchdog flagged its patents. PYMNTS said it had not immediately received replies from the other companies named in the orders.

The inquiry also looks at whether driver pay varies with factors such as a driver’s phone usage or history of accepting past work offers, and whether prices vary with loyalty program membership or analysis of personal data by data-analysis tools.

Reporting based on coverage by ConsumerAffairs and PYMNTS.