The Gig is Up: Using Digital Platforms for Work

By Karalynn Cromeens

These days, technology plays an ever-growing hand in running construction companies. From networking to project management, people are online. Many contractors and subcontractors are turning to lead generation via online gig economy vendors. All kinds of sites promise maximum return for minimum investment. As some say, “Sign up today and get 100 new leads within a week.” I tend to warn that if something sounds too good to be true, it usually is. My goal is to ensure you go into every situation with wide-open eyes, knowing all the risks.

Consider the Facts

If you want to take work you found online, keep your eyes peeled for a few essential tells. The first thing to consider is who is collecting and controlling the funds. I once had a client who did freelance cabinet installations for a large retail store he had connected with online. On one project, he installed cabinets for a homeowner. Like many similar online opportunities, he signed an agreement with the hiring party—in this case, the store—not the homeowner. The homeowner had signed off on the installation and said everything was fine, but the next day the wife called the store and said the installation was horrible and she did not want the same person to come out and fix the issues. Even though my client strongly disagreed that the installation was bad, the store took the homeowner’s side and deducted $1,500 from the amount that my client was owed. After I read the agreement my client had signed with the store, it was clear that there was nothing we could do. My client agreed that any decisions made by the store regarding credits and discounts were final per their agreement. The store also had the right to offset, meaning if he had already been paid on a project, they could deduct from the funds they were due from other projects.

Had my client done a better job of vetting his agreement on the front end, he may not have found himself in such a tight spot, unable to defend his work and fight for this compensation owed. This is why you must always look over the terms of agreements you find online and know where your money is going.

Contractors vs. Control

Building off the situation above, another issue from a legal point of view is the lack of control the subcontractor has. The online gig vendor has the right to lock you out of the platform anytime for any reason or no reason. This means that one day they could lock you out of the platform or even neglect to help you recover a password when you still have ongoing projects, and you would just be done. The online gig vendor is also not responsible for any of the consequential damages of this action. Any jobs or money you lose because they locked you out of the platform would not be their responsibility, even if they locked you out by accident. The weight of the related consequences would fall on you alone.

When you sign up for an online gig vendor, you have no rights if you disagree with a decision they make. The agreement you signed to become a member waives all your rights and normally states the place for any legal battle would be the vendor’s home turf, which is probably not where you live.

Be Aware

With online gig vendors, the biggest warning I can offer is, don’t put all your eggs in one basket. Online gigs are a great way to start a new business or fill in some gaps if things get slow, but they should not be your only source of work. If you’re considering using an online gig vendor, stay informed about your agreement by having a construction legal professional review it before signing it. You can never be too cautious when looking for work online, and your work’s integrity and pay are worth the caution.

Karalynn Cromeens is the owner of The Cromeens Law Firm and The Subcontractor Institute in Houston. She has been a licensed construction attorney for over 16 years.

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