Handshake Owes Contractors Thousands as Pay Disputes Mount

A college junior says Handshake AI paid him $8,000 for roughly $19,000 worth of AI training work, and he's not alone — nearly two dozen contractors told Business Insider the startup underpaid them this year, with disputes totaling $64,000 over six months.

Joel Thomas says he is owed about $11,000 in back pay for hundreds of hours on Handshake's platform. Handshake has denied his appeals. The company told him there was no record of his work during the third week of August — even though a Handshake pay statement showed he completed 428 tasks that week for Project Novel, for which he received nothing.

Business Insider reviewed bank statements, pay stubs, and hundreds of email and Slack messages between contractors and the company.

What does this change for AI gig workers?

The core issue is structural. Contractors saw dollar figures on their dashboards based on time they logged themselves with a manual timer. The client paying for the project ran a second timer the contractors couldn't see, former Handshake employees said. Before paying, Handshake compared the two — and contractors were never told what counted as billable time or how the client calculated it.

"Final pay reflects the work our systems verify," a Handshake spokesperson told Business Insider. "Where logged time doesn't match the work, we review it, and where we find inflated time we don't pay for it."

The company said a dedicated team independent of the project reviews disputes and "can restore all or part of the amount."

How the disputes piled up

Former staffers pointed to thin staffing and breakneck delivery pressure. On some marquee projects, one person managed up to 1,000 contractors. Project managers used AI coding tools like Claude and Lovable to generate instructions that were sometimes contradictory. Contractor questions piled up on Slack unanswered. If a contractor misread confusing instructions and the task failed review, they weren't paid for it.

Thomas's story shows the pattern. Liberty University directed him to Handshake's career platform in January. After small spring projects paying about $17 an hour, he received August invitations for work paying $50 an hour and $65 per task. He worked from mid-morning until midnight or 1 a.m., watching his dashboard climb past $19,000.

Then the payments came in short. He posted on Reddit: "This is such a scum thing to do and I am unsure what I should do. Just want to expose them as much as possible because this is ridiculous." He emailed Handshake a screenshot showing $15,741.23 "awaiting payout," writing on August 27: "I highly suggest you check your systems."

Handshake said the "awaiting payout" figure was an estimate, and that "our project leads did not find any tasking that took place during this time frame" for August 17 to 23. A spokesperson said "no tasking took place" is shorthand for "no verified work." The company then deactivated his account, citing irregular activity.

A business built on pay transparency claims

The irony is sharp. Handshake says more than 188,000 contractors have earned over $500 million on its platform, and CEO Garrett Lord has pitched reliable pay as the company's edge over rivals like Scale AI and Mercor. He has said payment complaints at other AI-training firms motivated Handshake's entry into the business.

"Most AI gigs = shifting rates, zero transparency," Lord wrote in a LinkedIn post last year. "Handshake AI = competitive pay, clear expectations, and real dialogue. That's what experts deserve."

Handshake, founded in 2014 by three Michigan Tech students, pivoted from college career services into AI training in January 2025. Lord said in August that the AI unit has grown past $1 billion in gross annualized revenue, with most revenue coming from five clients: Meta, Google, OpenAI, Nvidia, and Anthropic.

In October, after Business Insider sent detailed questions, the company rolled out a payments dashboard, clearer adjustment explanations, an easier dispute process, and a new live timer for third-party platforms. "Our Fellows are the heart of Handshake AI," the company wrote in an October blog post. "You should always know what you earned, how it was calculated and when it will arrive."

Business Insider first reported in March that one contractor had won a $6,475 small-claims judgment against Handshake. Thomas, for his part, says he's given up on recovering his money — though he'd still take another AI training gig. For a workforce paid by invisible client-side timers, the practical question is whether October's transparency tools actually close the gap between estimated and verified pay.