Years ago, while on a long trip across the United States, Sanish Mondkar realized that there were stark and problematic disconnects between employers and the staff they employ.
TO critics of late capitalism, that might seem like an obvious observation. But Mondkar, who has a master’s degree in computer science from Cornell, says seeing the problems up close made the difference.
“As I traveled from city to city, I couldn’t help but notice the perpetual ‘for rent’ signs in the windows of countless labor-intensive businesses like retailers and restaurants,” he said. “At the same time, I saw employees who changed jobs frequently, but struggled to earn a living wage. “This disparity between the needs of employers and the realities of workers struck a chord with me.”
Inspired by this experience, as well as his stints at Ariba as executive vice president and chief product officer at SAP, Mondkar set out to create a startup that helps companies manage their workforce, particularly the contract and gig workforce. His company, Legionannounced today that it raised $50 million in financing led by Riverwood Capital with participation from Norwest, Stripes, Webb Investment Network and XYZ.
“My goal was to rebuild the workforce management business category to maximize companies’ labor efficiency and deliver value to workers simultaneously,” Mondkar said. “I wanted to differentiate the company itself by focusing on WFM’s intelligent automation and employee value proposition.”
Legion is designed to help customers (employers like Cinemark, Dollar General, Five Below and Panda Express) manage their hourly staff by automating certain decisions, such as how much labor to deploy, where and when to schedule workers. Taking into account demand forecasting, work optimization and employee preferences, Legion’s platform generates work schedules.
Employees whose companies are on Legion can use their mobile app to ask how they want to work and set their preferred hours. Legion’s algorithm then attempts to match workers’ preferences with the company’s needs.
Legion also incorporates performance management tools and a rewards program of sorts.
“We use algorithms trained on a combination of customer data and third-party data, which Legion aggregates from its partners,” Mondkar said. “This integration allows forecasting for resource planning and allocation.”
In addition to basic programming features, the trendy Legion is leaning into generative AI with a tool called Copilot (not to be confused with Microsoft Copilot). Copilot answers questions about work based on an organization’s employee handbook, work rules, and training content. In the coming months, Copilot will gain the ability to summarize work schedules and fulfill requests to add or delete shifts or change staff assignments.
“To attract and retain staff, companies employing hourly labor must emulate gig-like flexibility,” Mondkar said. “Legion provides this with intelligent scheduling automation. Managers can adapt staffing to projected demand, closing the gap between employee needs and business needs.”
That’s all well and good, but two concerning things stand out to me about Legion: their privacy policy and their earned wage access (EWA) program.
Legion says it stores customer data for seven years by default, a long time by any standards. Most concerning, the data includes personally identifiable information, such as workers’ first and last names, email and home addresses, ages, photographs, and work preferences. Oh!
Legion says the data is necessary to “facilitate scheduling in accordance with labor standards” and that users can request that their data be deleted at any time. But I question the ease of the deletion process and how transparent Legion is about its data retention policies to customers.
My other complaint with Legion is InstantPay, Legion’s EWA program, which allows employees to access a portion of their earned wages before their scheduled paydays. Legion charges workers $2.99 for instant transfers of earned wages, while overnight transfers are free; It may not seem like much, but can add for a low-income worker. Legion presents this as a benefit for hourly workers that gives them “increased flexibility” and “control” over their finances, as well as a business retention tool. But EWA programs are under scrutiny from policymakers, consumer rights advocates and employers. The Legion mobile application.
Some consumer groups argue that EWA programs should be classified as loans under the U.S. Truth in Lending Act, which provides protections such as requiring lenders to provide advance notice before raising certain fees. These groups say EWA programs can force users to overdraw while charging interest through fees.
Additionally, it is unclear whether EWA programs are a net gain for employers. Walmart recently tried to combat attrition by giving hourly staff early access to salaries. Instead, he found that employees who used EWA tended to quit smoking faster.