In mid-January, the news that Microsoft was investing almost US$70 billion in the ‘metaverse’ hit the headlines. Yet it was only the latest in a series of such massive investments. Technology companies such as Google and Epic Games, brands such as Gucci and Nike, and even retailers such as Walmart are entering or even shaping the metaverse – and, of course, only a few months ago Facebook rebranded as ‘Meta’ to signal its commitment.

The metaverse is envisaged as a new way of interacting with various components of cyberspace – augmented reality, the combination of digital and physical aspects of life, three-dimensional technology, the ‘Internet of Things’, personal avatars, and digital marketplaces and content providers – to generate a more active, immediate and immersive experience. And this could respond to the crisis of long-established ‘social media’, disrupted by young users’ uninterest and regulators’ intense scrutiny.

As Microsoft’s deal indicates, however, this is more about money than meaning. Last June, the purchase of a virtual Gucci handbag for the equivalent of US$4,000 in virtual currency, to be worn by an avatar, was emblematic of the economic transactions which may populate the metaverse.

Legally, so many issues arise. Who, for example, owns that bag: the buyer, the platform or the producer who rents it to a client? What happens if the platform does not work properly and the bag does not look pristine? Could another subject ‘steal’ it – and then what? Could the bag be ‘taken’ from one platform to another, just like carrying a handbag bought in one shop into another? If not, do anti-trust issues follow?

These are only instances of the legal complexity surrounding digital exchanges. What law will apply in the metaverse amplifies the wider uncertainty as to what law applies on the internet.

Is it the law of the country where the company owning the platform is based? What, then, if the platform is shared? Is it the law of the place where the servers are based? And what if the platforms are underpinned by blockchains and dispersed around the world? Or is it the law of the place where the product’s virtual producer is based, or the country where the consumer brand is based? Why not the one where the client is based? Even the simplest transactions can unleash mind-boggling legal problems, including about labour laws.

Metaverse as workplace

The metaverse will have its users but it will also be a ‘workplace’ for many. This year, Microsoft is reportedly set to combine “the mixed-reality capabilities of Microsoft Mesh” –which “allows people in different physical locations to join collaborative and shared holographic experiences” – with the better-known “productivity tools of Microsoft Teams, where people can join virtual meetings, send chats, collaborate on shared documents and more.” The aim is to create a more interactive and collaborative work experience for remote workers.

While this may sound like a good thing, a first concern is that such a combination will add to the stress of being subject to evermore invasive and relentless forms of algorithmic surveillance, already experienced by remote workers, as well as the sometimes toxic and oppressive dynamics of the office. The potential for augmented psychosocial hazards cannot be overestimated, including because new forms of cyberbullying at work could be enabled by the technologies constituting the metaverse.

Moreover, if these ‘metaverse offices’ were really to spread, the risk of ‘contractual distancing’ for the workers involved would soar. If businesses are able to have virtual offices which persuasively mimic physical ones and, at the same time, have access to a worldwide workforce of prospective remote workers; their ability to outsource office work towards countries with much lower salaries and weaker labour protection – and to engage in the mass misclassification of employment status – will increase enormously.

The platform economy will serve as a blueprint. Here, businesses have already lucratively combined heightened surveillance, sham self-employment and ‘crowdsourcing’ of work towards the Global South, taking advantage of abysmal pay rates and zero employment protection. Nor have they ever been stopped by time zones, as crowdworkers have long worked unsocial hours for clients everywhere in the world.

The metaverse could however make these trends explode in the not-too-distant future. It will not only affect work already done remotely.

Big chunks of activity in retail and ‘in-person’ customer care could be moved online if the virtual experiences are sufficiently convincing and smooth.

Why leave home to go to a shop and seek advice about an item, if one can speak satisfactorily with a shop assistant through an avatar and buy the item online?

Then, alongside all the risks identified, the question will be – what employment and labour regulations will apply to these working activities? Those of the countries where the platforms are located – and, again, where is that? Those where the employer is based (ditto)? Or those where the workers are based? And how to build solidarity and foster collective action among a globally dispersed workforce which can only ‘meet’ via proprietary, business-owned platforms?

Adding to the threat that these workers will be misclassified as self-employed, through a variety of legal stratagems and shrewd Big Tech storytelling, payment in cryptocurrency – another expected feature of the metaverse – will likely be used to muddy the waters over employment status and protection. The next-to-nothing application of labour protection to crowdworkers hitherto makes these concerns urgent.

Content creators

Many professionals are already working to shape the metaverse. They have been said to include researchers, cybersecurity specialists, system developers and hardware builders; marketing experts and business developers are in there too. Crucial will be the content creators designing and initiating the experiences, events, post contents, and traded goods and services of the metaverse.

This is already a complex labour issue, as many content creators have been rendered heavily dependent on the platforms where they share their contents – how these contents are distributed; how the algorithms rank them and make them visible; how they are monetised and indeed what content could lead to their account being deactivated. Content creators have seldom any say or agency on this.

So far, attempts to build a collective voice for these workers – even when supported by major trade unions, as with YouTube creators – have not really come off. Even where creators have an employment contract, as sometimes happens in the video games industry, labour conditions often remain dire, although workers and unions are challenging some of these practices.

The metaverse certainly opens up new prospects for creators but it also enhances opportunities for their exploitation. The growing number of people who will be performing such activities to serve the metaverse warrants far more decisive attention by regulators, unions and public authorities.

Moreover, contrary to the touted mirage of a decentralised virtual domain, the metaverse could result in a more intense concentration of private power. Mistrust of old institutions is here once again misappropriated to shift users’ and investors’ interests towards top-down technologies, where the ‘polycentricity’ rhetoric is a smokescreen. The technology writer and thinker Evgeny Morozov has warned that “networks, once operated by private players and without democratic public oversight, could be just as tyrannical and constraining as hierarchies, albeit in different ways.”

When it comes to these and other labour issues triggered by the metaverse, it is vital to learn from the past and not wait until these problems are already embedded. Reaction to the challenges of platform work has been much slower than needed: digital labour platforms bought crucial time while everyone else was embroiled in the questions ‘is this really work?’ and ‘does it warrant and deserve protection?’ This time, we could at least try to skip that by saying: ‘Of course this is work, and every work deserves protection, no matter where and how it is discharged or how it is paid.’

The metaverse should not become another ‘wild west’ for labour protection. It is crucial to dovetail new models with existing regulation and fine-tune legislation to accommodate new initiatives. But for this to happen, attention and strategic planning are urgently needed.