Tuesday 10 April 2018

Uber: unter

We learn this week, courtesy of a failed class action lawsuit, that Uber drivers in Toronto wanting to pick a legal fight with the company have to do so in...The Netherlands, because their arrangement with the company is actually with one of its subs in that country.  It's just another way that Uber tries to make it difficult for the authorities in the cities where it operates to enforce their employment laws against it.  Five gets you fifty that if Uber drivers in Rotterdam check their own contracts, they'll find that their dealings have to be with an Uber sub in Iqaluit or Tuktoyaktuk.

What a wonderful corporate citizen Uber is, to be sure.
  • It muscles in on new markets and basically defies local authorities to try to regulate it.  In the process licensed cabbies, who have generally been subjected to background checks and at least a modicum of training, lose their livelihoods.
  • Studies are increasingly showing that the arrival of Uber in a city leads to an uptick in traffic congestion, thanks to all those drivers cruising around hoping to pick up a ride.  Uber's business model effectively depends on it signing up far more drivers than it can ever expect to need at any given time.
  • Precisely because there are so many drivers, studies are starting to suggest that earnings are very low -- less than $4 an hour.  In the case of Toronto, this compares to the new minimum wage of $14 per hour -- but of course, Uber argues that its drivers are freelancers rather than employees, so the minimum wage doesn't apply anyway.
  • When passengers really do need to use Uber -- after a ball game, in a rainstorm, when the subway is broken -- they fall prey to the company's predatory "surge pricing" model.  There are horror stories of customers facing astonishing bills for short journeys when the surge pricing algorithm kicks in. 

If this is the "sharing economy", count me out.  And don't even get me started on Airbnb.




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