Ban on surveillance-based pricing and wages

Summary#

This bill would ban using automated systems (algorithms or AI) that rely on surveillance data to set individualized prices or worker pay. It requires businesses and employers to publish transparency procedures before using such systems. The bill aims to stop personalized price gouging and algorithm-driven wage discrimination and to increase transparency and legal remedies for harmed people.

Key changes:

• Bans "surveillance-based price setting": using automated decision systems plus surveillance data to offer a custom price to a specific person or small group.
• Creates limited exceptions for cost-based price differences, broadly disclosed group discounts (teachers, seniors, etc.), and loyalty programs if rules are clearly disclosed and surveillance data is used only to give the discount.
• Bans "surveillance-based wage setting": using surveillance data or personal information in automated systems to set or inform an individual’s compensation, with an exception if the system only uses city/state and cost-of-living data.
• Requires businesses and employers to publish, at least 180 days before use, procedures for data accuracy, disclosure of what data is used, and how people can correct or challenge data.
• Enforcement: FTC enforces the price rules; EEOC may bring actions for wage rules; states can sue; individuals have a private right of action with damages and fee-shifting; arbitration and class-waiver clauses are not enforceable for these claims.
• Preserves state laws that give greater protections and preserves collective bargaining rights.

What it means for you#

• Consumers

  • Businesses may no longer use surveillance data (like behavior, biometrics, or other personal data) to set an individualized price for you.
  • If you are offered a discount through a loyalty program or a broadly disclosed group discount, firms must clearly disclose eligibility and use surveillance data only to give that discount.
  • You can sue for harm if a company violates the price rules. A court can award actual damages or $3,000 per violation (whichever is greater). Willful violations can lead to up to triple damages.

• Workers

  • Employers may not use surveillance data or personal information in automated systems to set your pay or other earning-related terms (schedules, bonuses, commissions), unless the system uses only city/state and cost-of-living data.
  • Employers must publish procedures explaining what data is used and how pay decisions are made. You can challenge or correct data used to set pay.
  • You can sue for violations. Remedies mirror the price rules (actual damages or $3,000 per violation, possible treble damages for willfulness, and attorneys’ fees for prevailing plaintiffs).

• Businesses and Employers

  • Firms must stop or change systems that use surveillance data to set individualized prices or wages.
  • Before using any automated system to set prices, offer discounts, or inform wages, they must publish accuracy, disclosure, and dispute procedures at least 180 days in advance.
  • Firms face enforcement by the FTC for price rules and by the EEOC and FTC for wage rules, plus state actions and private lawsuits. Arbitration clauses and class-waiver agreements cannot block these private claims.
  • Common carriers and nonprofits are explicitly subject to FTC enforcement under this law.

• States and State Attorneys General

  • States can sue on behalf of residents for violations, seek injunctions, damages (actual or $3,000 per violation), and other relief.
  • State laws that provide stronger protections are preserved.

• Labor Unions and Collective Bargaining

  • The law preserves the right to bargain over the use of automated systems and says the bill sets a floor, not a ceiling, for protections. Employers must give advance notice and an opportunity to bargain if a contract exists.

Expenses#

No publicly available information.

Possible cost areas the bill itself implies:

• Increased administrative and compliance costs for businesses to revise pricing and payroll systems, publish procedures, and operate data-correction processes.
• Potential legal costs from more private lawsuits, state enforcement actions, and agency enforcement.
• Enforcement costs for federal agencies (FTC and EEOC) to investigate and litigate violations.
• Potential payouts or penalties if courts award damages, treble damages for willful violations, or restitution.

Proponents' View#

• The bill appears intended to prevent businesses and employers from using surveillance-based automated systems to charge different consumers different prices or to set worker pay in ways tied to personal surveillance.
• Supporters may argue this increases transparency by forcing firms to disclose what data they use and to provide correction procedures.
• The bill could be seen as protecting consumers and workers from hidden algorithmic discrimination or price gouging.
• Preserving collective bargaining and allowing state laws with stronger protections may be presented as balancing federal rules with local authority and labor rights.

Opponents' View#

• One concern is that key terms (for example, what exactly counts as "surveillance data," or when data is used "solely" to offer a discount) may be open to interpretation and could create legal uncertainty for firms and regulators.
• The bill does not provide a fiscal estimate. It is unclear how much enforcement will cost federal agencies or how many private lawsuits it would generate.
• The 180-day advance publication requirement may be burdensome for businesses that update pricing or pay systems frequently.
• The private right of action, statutory damages per violation, and fee-shifting could increase litigation risk for businesses, including small firms.
• It is unclear how the rules will interact with other federal or state privacy and consumer-protection laws in practice, beyond the stated preservation of stronger state laws.