New Law Bans Personalized AI Pricing and Wage Fixing, Gives Consumers $3,000 Minimum Payouts

The newly introduced Stop AI Price Gouging and Wage Fixing Act of 2025 takes direct aim at the opaque algorithms that currently determine what you pay for goods and what you earn for your labor. Simply put, this bill says companies can no longer use automated systems that track your personal data—your browsing history, location, or past purchases—to set a customized, higher price just for you. This practice, known as “surveillance-based price setting,” is now generally illegal (SEC. 2).

The End of Personalized Price Tags

Think about shopping online. Right now, a retailer’s system might see you’ve bought expensive items before, or that you’re browsing from a high-income zip code, and automatically show you a higher price than it shows your neighbor. This bill bans that. The key exception is that price differences are still allowed if they are based on actual cost differences (like shipping) or if they are part of broad, publicly defined groups (like student or senior discounts). Loyalty programs are also fine, but only if the customer actively signed up for them (SEC. 2).

Crucially, if a company uses an automated system for one of those exceptions, they have to publish their procedures 180 days in advance. They must detail how they ensure the data is accurate, and they must give you a way to challenge or correct the data the system uses to set your price (SEC. 2). For the average person, this means more predictability in pricing and a clearer shot at fighting back if you think the system got it wrong.

Protecting Your Paycheck from the Algorithm

On the job front, the bill targets “surveillance-based wage setting,” which means employers can’t use automated systems to set your pay based on personal information or surveillance data about you, your behavior, or groups you belong to. This is a big deal for workers, especially in the gig economy or large corporations where algorithms often determine shifts, tasks, and ultimately, pay (SEC. 3).

For example, if an algorithm infers from your personal data that you are likely to stay at your current job because you have high student debt or just bought a house, it can’t use that inference to justify paying you less than someone else with the same qualifications. The only exception is if the system only uses data about your location and local cost of living. Like the pricing rules, employers must publish their automated wage-setting procedures, including how they ensure data accuracy and how a worker can challenge the data used to determine their compensation (SEC. 3).

The Enforcement Hammer: Why Companies Should Pay Attention

This bill has teeth. Both the Federal Trade Commission (FTC) and the Equal Employment Opportunity Commission (EEOC) get enforcement power, even over common carriers and non-profits that usually fall outside their jurisdiction. But the real game-changer is the private right of action for consumers and workers (SEC. 2, SEC. 3).

If you are harmed by a violation, you can sue, and if you win, you are guaranteed the greater of your actual damages or a minimum of $3,000 per violation. If the business acted willfully, that award can be tripled. Plus, the losing party has to pay your attorney fees. This high statutory damage floor and the mandatory fee-shifting create a massive financial risk for companies that violate the rules, providing a strong deterrent. Even better for the little guy: any pre-dispute forced arbitration agreements or class action waivers are invalid and unenforceable for disputes under this Act, making it easier for people to seek justice in court (SEC. 2, SEC. 3).

The Bigger Picture: Floor, Not Ceiling

For states and unions, the bill is clear: this federal law is a floor, not a ceiling. If your state has a law that offers more protection against surveillance or wage manipulation, that state law remains fully in effect (SEC. 4). Similarly, the law explicitly preserves the right of employees to collectively bargain over how automated systems affect their work and pay, ensuring that union contracts offering stronger protections still stand (SEC. 5).