Uber drivers in Britain started a day of transatlantic strikes on Wednesday to protest at the disparity between gig-economy conditions and the sums investors are likely to make in Friday’s blockbuster stock market debut.
Drivers and regulators around the world have long criticized the business tactics of Uber Technologies, and the expected $90 billion valuation in an IPO on Friday is proving to be the latest flashpoint.
Unions in Britain said they were seeing good support for the strike, with drivers staying at home and passengers using the #UberShutDown hashtag to pledge solidarity on social media. The Uber app said fares were higher in London during a rainy morning rush hour, due to increased demand.
“Stand with these workers on strike today, across the UK and the world,” said Jeremy Corbyn, the leader of Britain’s opposition Labour Party.
Drivers in London and the cities of Birmingham, Nottingham and Glasgow were due to log off the app between 0700 and 1600, before counterparts in New York, Los Angeles, San Francisco, Chicago and several other major cities joined in.
Uber has 3 million drivers globally, and it is not clear if the action can significantly slow service, although organisers have received widespread publicity.
Chief Executive Dara Khosrowshahi, hired to help move the company past a series of scandals and manage the IPO, has promised to treat drivers better. Uber is paying more than a million drivers about $300 million in one-time bonuses for instance, and has changed policies such as allowing riders to tip.
“Whether it’s being able to track your earnings or stronger insurance protections, we’ll continue working to improve the experience for and with drivers,” it said.
UNDER PRESSURE
Uber has steadfastly and mostly successfully beaten attempts to compel it to treat drivers as employees, arguing that its main business is a platform that brings riders and drivers together. And the money-losing company is under pressure to cut costs.
“It is the drivers who have created this extraordinary wealth but they continue to be denied even the most basic workplace rights,” said James Farrar, Chair of Britain’s United Private Hire Drivers, calling for a “digital picket line”.
Many drivers want better pay from Uber rival Lyft Inc as well.
“Both Uber and Lyft have said that the greatest threat to their investors is driver dissatisfaction. They know that they’re paying too little to keep drivers satisfied,” said Los Angeles organiser Brian Dolber.
Uber and Lyft have steadily chipped away at rates, particularly in the more established markets where they have cut back on incentives and bonuses to attract new drivers. They have also devised more complicated formulas for determining what riders pay and what drivers earn.
Both companies recently slashed the per-mile rate drivers earn in Los Angeles and San Francisco, and some drivers estimated a loss of 10 per cent to 20 per cent in earnings. Lyft said its hourly wages have risen over the last two years and on average are over $20 per hour.
The company and its critics are divided over how much drivers can make. Classified as independent contractors, they lack paid sick and vacation days and must pay their own expenses, such as car maintenance and gasoline.
Uber noted that a recent study whose authors included current and former Uber employees showed driver gross earnings averaged $21 an hour, while a study by left-leaning Washington think tank Economic Policy Institute calculated that after all costs, Uber drivers earned $9.21 in hourly wages.
