To say that I am ashamed is an extreme understatement, says Uber boss

The Uber story continues to highlight the worst of the so-called “gig economy”, which represents the leading edge of corporate exploitation of workers in the developed world. And each time the ride-hailing company meets with disaster, it seems to accelerate its bad news. Uber and its fellows are reinventing the robber-baronies of old style capitalism, but as they gleefully count the booty their businesses look shakier and shakier.

Uber boss, Travis Kalanick, loves the limelight and the headlines. But at the end of February, Uber’s self-styled “leader” was forced to publish an open letter apologising for treating Fawzi Kamel, an Uber driver since 2011, “disrespectfully” and admitting that he “must fundamentally change as a leader and grow up”.

“To say that I am ashamed is an extreme understatement,” Kalanick wrote, which may not be enough to counter his growing reputation among drivers as a pugnacious control-freak determined to squeeze the last cent out of his workers. When Kamel told Kalanick — who was using his own company’s services — that working for Uber had cost him $7,000 in a year because of the company’s predatory pricing policies, Kalanick responded: “Some people don’t like to take responsibility for their own shit. They blame everything in their life on somebody else.”

Kalanick has now chosen to appoint a deputy, in the role of Chief Operating Officer (COO), to help manage a business valued at $70bn that under Kalanick’s leadership is increasingly seen as accident prone.

Last December, one of Uber’s self-driving Volvo cars ran a red light in San Francisco. The company fired the employee who had been monitoring the car at the time. But leaked information revealed that Uber’s much vaunted mapping program had already ignored six red lights in the area; the car had been at fault, not the employee. Apparently Uber’s SCDs have a pretty poor record of detecting cycle lanes, too.

In any case, Uber had to pull its self-driving cars (SCDs) off the road after the California Department of Motor Vehicles (DMV) found that they were operating without the appropriate permit covering “autonomous vehicles”.  Uber apparently insisted it did not need a permit, since its vehicles were not “fully” autonomous. Those sackable employees must be good for something.

The next month, January 2017, saw more than 200,000 people in the US uninstall their Uber accounts from their phones. A Twitter campaign trending under the hashtag #DeleteUber exposed the company’s efforts to encourage its drivers — many of whom are from immigrant backgrounds — to scab during a strike called by the New York Taxi Workers Alliance to protest Donald Trump’s refugee ban.

Realising how Uber’s employees, users and immigrant drivers felt about the Trump administration, Kalanick reluctantly resigned from the president’s business advisory council. But then a former software engineer at Uber, Susan J. Fowler, wrote a blog post describing Uber’s sexist culture in which she claimed that male managers sexually harass and discriminate against women with impunity.

The company announced that it would form a high-powered team to investigate Fowler’s allegations, headed by former US attorney general, Eric Holder, and including the Uber board’s only woman member, Arianna Huffington (or Huffington-Puffington, as she is known to some).

Next, Google’s SCD company, Waymo, launched a legal action against Uber and its own SCD company, Otto, for the theft of trade secrets. A few days later, it came out that Uber’s head of engineering had faced a sexual harassment complaint when he worked for Google. He denied the allegations, but resigned anyway.

Meanwhile, in Switzerland an insurance company specialising in public liability has decided that Uber drivers are employees and not self-employed contractors. The decision, if it is upheld by the courts, would mean that Uber has to pay earnings-related social security contributions on behalf of its Swiss drivers. Unia, the Swiss union for workers in the private sector, has welcomed the decision, saying the rise in independent contracting is leaving a social security shortfall in the millions.

The current case against Uber going through the UK’s employment tribunal system, with support from the GMB union, seems likely to produce a similar result.

The GMB has accused Uber of misleading its drivers by claiming that the tribunal decision against Uber only affects the two drivers who brought the case. In a piece of remarkable sleight of hand, Uber announced its intention to pursue this case to the UK Supreme Court, at the same time as it was telling its London drivers that they shouldn’t expect any benefits from the judgement. Of course, an appeal to the Supreme Court could take months, but it will clear up any lingering confusion as to whether Uber has two real employees driving for it in London, or 30,000 odd.

Similarly, a claim against Uber brought by the Spanish taxi drivers association Asociación Profesional Élite Taxi (APET) has reached the European Court of Justice which has been asked to rule on whether Uber is a transport service provider, information society service provider, or a combination of both. The eventual decision will affect the company’s responsibilities, and its costs, throughout the EU.

In the US, Uber is facing more than a dozen lawsuits challenging the company’s classification of drivers as self-employed contractors, alleging various violations of state and federal labor laws, and seeking compensation for losses incurred by allegedly misclassified drivers. Testimony from numerous drivers demonstrates the degree of their exploitation. “I was making substantially less than minimum wage,” according to one driver who worked for Uber for two months to see whether he could earn a living, “working 60 hours a week at very anti-social hours, meeting many self-entitled unpleasant people, my health started to suffer, my social life was almost non-existent and I was treated as a servant by most people.”

The New York Taxi Workers Alliance (NYTWA), an AFL-CIO member and ITF affiliate which represents 19,000 New York taxi, black car and Uber drivers, has been fighting a class action lawsuit in New York and has lodged a complaint with the National Labor Relations Board claiming that agreements between Uber and individual drivers illegally prohibit them from bringing class action claims. The court cases could prove expensive for Uber. One case alone, in Uber’s hometown of San Francisco, may be worth as much as $1 billion in claims for unpaid earnings and expenses.

Among other things, these judgements will have important consequences for Uber’s current cavalier approach to the regulations affecting private hire vehicles. On one forum for Uber drivers, to take a small example, Uber’s UK bosses have been accused of recommending that drivers in the Manchester area should apply for their licences from the local authority in the neighbouring small town of Rossendale, where they are not required to pass a test of their geographical knowledge of the area.

In New York, the NYTWA is fighting the whole basis of Uber’s operation in the shape of Transportation Network Company (TNC) rules which allow “app-based dispatching” taxi services to dispatch fares to unregulated private motorists, using personal cars, throughout the State of New York.

In an even more egregious example of Uber’s approach, the union representing taxi drivers in Buenos Aires — having been involved in a successful lawsuit against Uber when the company launched in Argentina in April 2016 — is still fighting to get the company to adhere to the court’s judgement. The union argues that Uber operates illegally because its drivers work as self-employed contractors, using their own cars or cars bought through Uber, and don’t pay the same insurance and licence fees as regulated cab drivers. The court found against Uber and banned its operations throughout Argentina, but the company has ignored the ruling.

When the court ordered credit card companies to block Uber transaction, the company introduced prepayment features in its app and continued to operate. In February, the court came close to jailing Uber’s local management, but settled for imposing a complete block on the app. It may yet come to imprisonment.

It’s beginning to look like the company may need more than a new deputy boss if it wants to keep its dominoes in place.

More details

Sarah Buhr, ‘Travis Kalanick apologizes for blowing up at Uber driver who complained about drop in pay’, Techcrunch, 28 February 2017.

Eric Newcomer, ‘Uber Rolls Out Self Driving Cars in San Francisco Without DMV Approval‘, Reuters, 14 December 2016., ‘How would you fix Uber’., ‘Uber self-drive car was at fault for running red light in December‘.

Asociación Profesional Élite Taxi v Uber Systems Spain, S.L. European Court of Justice Case Law.

Chris George, ‘How much can an Uber driver earn in London?’, Quora, 21 December 2016.

Daniel Weissner, ‘New York taxi driver group says Uber violating labor laws‘, Reuters, 2 June 2016.

Uber ordered to stop service in Argentina‘, CNN, 30 January 2017.

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Gary Herman

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