Brexit and the waning days of the United Kingdom

[Sheilbh]

The issue isn't just whether the worker is an employee or some version of a contractor running their own business.  It is enforcing licensing fees and other regulatory costs that their competitors in the market have to pay, and when the gigs have avoided through the fiction that they are not in the market, giving them an unfair commercial advantage.

I agree but those are separate and their licence is under heavy challenge in London. The big issue here is that Uber are not able to demonstrate that they have the controls in place to know who's driving passengers. Which is pretty basic.

I think the Uber model is don't follow the laws to cut your costs, but don't charge a profitable rate on your routes to build up market dominance and then pressure for those regulations to be changed and hike rates from a position of power. I think it's failing everywhere now and they'll be challenged by new entrants in the next decade or so.

[crazy canuck]

The issue isn't just whether the worker is an employee or some version of a contractor running their own business.  It is enforcing licensing fees and other regulatory costs that their competitors in the market have to pay, and when the gigs have avoided through the fiction that they are not in the market, giving them an unfair commercial advantage.

I agree but those are separate and their licence is under heavy challenge in London. The big issue here is that Uber are not able to demonstrate that they have the controls in place to know who's driving passengers. Which is pretty basic.

I think the Uber model is don't follow the laws to cut your costs, but don't charge a profitable rate on your routes to build up market dominance and then pressure for those regulations to be changed and hike rates from a position of power. I think it's failing everywhere now and they'll be challenged by new entrants in the next decade or so.

That is definitely the model.  And a lot of jurisdictions are saying, not in our town you won't.

The Yi's of the world are going to continue to think that it is regulation getting in the way of the free market.  I am not sure they will ever be convinced that it is actually a scam trying to duck regulations that everyone else has to live under.

[Admiral Yi]

How does this decision from the court make it too bad for the workers?

Some people prefer a pure commission system, where the more work you get the more you get paid.  Some people prefer the freedom to set their own hours.

[Josquius]

You can "set your own hours" whilst being an employee just as much as freelancers can.

[crazy canuck]

How does this decision from the court make it too bad for the workers?

Some people prefer a pure commission system, where the more work you get the more you get paid.  Some people prefer the freedom to set their own hours.

You seem to be under the illusion that these people are working for themselves, Uber PR people did a good job.

[Sheilbh]

Some people prefer a pure commission system, where the more work you get the more you get paid.  Some people prefer the freedom to set their own hours.

Sure - but that's not the only relationship that matters. Uber are operating in a market and their competitors are either offering drivers more freedom, or treating them as employees. Uber aren't.

But the freedom to set your own hours isn't the only thing that determines if you're an employee or not.

[Admiral Yi]

Sure - but that's not the only relationship that matters. Uber are operating in a market and their competitors are either offering drivers more freedom, or treating them as employees. Uber aren't.

How is Uber not offering its drivers more freedom?

But the freedom to set your own hours isn't the only thing that determines if you're an employee or not.

This is a separate question than the one I responded to.

[Sheilbh]

How is Uber not offering its drivers more freedom?

[...]

This is a separate question than the one I responded to.

Right - so these points are related. There are loads and loads of minicab firms with people who choose their own hours and are free-lance. They are not subject to the restrictions of the Uber system or the Uber contract. So a lot of Uber's competitors offer drivers more freedom. Since 2016 Uber have loosened some of the controls they had over drivers (and this'll be tested in another court case, I've no doubt).

Some minicabs operate with employees who are on the clock.

But Uber's competitors made their choices and bore the costs of each. Uber tried to have the best of both worlds.

[Admiral Yi]

Right - so these points are related. There are loads and loads of minicab firms with people who choose their own hours and are free-lance. They are not subject to the restrictions of the Uber system or the Uber contract. So a lot of Uber's competitors offer drivers more freedom. Since 2016 Uber have loosened some of the controls they had over drivers (and this'll be tested in another court case, I've no doubt).

Some minicabs operate with employees who are on the clock.

But Uber's competitors made their choices and bore the costs of each. Uber tried to have the best of both worlds.

I still don't know what freedom you are talking about.  The freedom to pick up a fare on the street?

[Sheilbh]

I still don't know what freedom you are talking about.  The freedom to pick up a fare on the street?

No - so that's cabbies. They're totally separate I mean other minicab firms.

The judgment ran through some of these points:

First and of major importance, the remuneration paid to drivers for the work they do is fixed by Uber and the drivers have no say in it (other than by choosing when and how much to work). Unlike taxi fares, fares for private hire vehicles in London are not set by the regulator. However, for rides booked through the Uber app, it is Uber that sets the fares and drivers are not permitted to charge more than the fare calculated by the Uber app. The notional freedom to charge a passenger less than the fare set by Uber is of no possible benefit to drivers, as any discount offered would  come  entirely  out  of  the  driver's  pocket  and  the  delivery  of  the  service  is  organised so as to prevent a driver from establishing a relationship with a passenger that  might  generate  future  custom  for  the  driver  personally  (see  the  fifth  point,  discussed  below).  Uber  also  fixes  the  amount  of  its  own  "service  fee"  which  it  deducts  from  the  fares  paid  to  drivers.  Uber's  control  over  remuneration  further  extends to the right to decide in its sole discretion whether to make a full or partialrefund of the fare to a passenger in response to a complaint by the passenger about the service provided by the driver (see para 20 above).

Second,  the  contractual  terms  on  which  drivers  perform  their  services  are  dictated by Uber. Not only are drivers required to accept Uber's standard form of written agreement but the terms on which they transport passengers are also imposed by Uber and drivers have no say in them.

Third, although drivers have the freedom to choose when and where (within the area covered by their PHV licence) to work, once a driver has logged onto the Uber app, a driver's choice about whether to accept requests for rides is constrained by Uber. Unlike taxi drivers, PHV operators and drivers are not under any regulatory obligation to accept such requests. Uber itself retains an absolute discretion to accept or decline any request for a ride. Where a ride is offered to a driver through the Uber app, however, Uber exercises control over the acceptance of the request by the driver in two ways. One is by controlling the information provided to the driver. The fact that the driver, when informed of a request, is told the passenger's average rating (from previous trips) allows the driver to avoid low-rated passengers who may be problematic.  Notably,  however,  the  driver  is  not  informed  of  the  passenger's  destination  until  the  passenger  is  picked  up  and  therefore  has  no  opportunity  to  decline a booking on the basis that the driver does not wish to travel to that particular destination.

The  second  form  of  control  is  exercised  by  monitoring  the  driver's  rate  of  acceptance  (and  cancellation)  of  trip  requests.  As  described  in  para  18  above,  a  driver whose percentage rate of acceptances falls below a level set by Uber London (or  whose  cancellation  rate  exceeds  a  set  level)  receives  an  escalating  series  of  warning messages which, if performance does not improve, leads to the driver being automatically  logged  off  the  Uber  app  and  shut  out  from  logging  back  on  for  ten minutes. This measure was described by Uber in an internal document quoted by the employment  tribunal  as  a  "penalty",  no  doubt  because  it  has  a  similar  economic  effect  to  docking  pay  from  an  employee  by  preventing  the  driver  from  earning  during the period while he is logged out of the app. Uber argues that this practice is justified because refusals or cancellations of trip requests cause delay to passengers in  finding  a  driver  and  lead  to  customer  dissatisfaction.  I  do  not  doubt  this.  The  question, however, is not whether the system of control operated by Uber is in its commercial interests, but whether it places drivers in a position of subordination to Uber. It plainly does.

Fourth, Uber exercises a significant degree of control over the way in which drivers deliver their services. The fact that drivers provide their own car means that they  have  more  control  than  would  most  employees  over  the  physical  equipment  used  to  perform  their  work.  Nevertheless,  Uber  vets  the  types  of  car  that  may  be  used. Moreover, the technology which is integral to the service is wholly owned and controlled by Uber and is used as a means of exercising control over drivers. Thus, when a ride is accepted, the Uber app directs the driver to the pick-up location and from  there  to  the  passenger's  destination.  Although,  as  mentioned,  it  is  not  compulsory  for  a  driver  to  follow  the  route  indicated  by  the  Uber  app,  customers  may complain if a different route is chosen and the driver bears the financial risk of any  deviation  from  the  route  indicated  by  the  app  which  the  passenger  has  not  approved (see para 8 above).

I  have  already  mentioned  the  control  exercised  by  monitoring  a  driver's  acceptance and cancellation rates for trips and excluding the driver temporarily from access to the Uber app if he fails to maintain the required rates of acceptance and non-cancellation. A further potent method of control is the use of the ratings system whereby passengers are asked to rate the driver after each trip and the failure of a driver to maintain a specified average rating will result in warnings and ultimately in termination of the driver's relationship with Uber (see paras 13 and 18 above). It is of course commonplace for digital platforms to invite customers to rate products or  services.  Typically,  however,  such  ratings  are  merely  made  available  as  information  which  may  assist  customers  in  choosing  which  product  or  service  to  buy. Under such a system the incentive for the supplier of the product or service to gain  high  ratings  is  simply  the  ordinary  commercial  incentive  of  satisfying  customers in the hope of attracting future business. The way in which Uber makes use  of  customer  ratings  is  materially  different.  The  ratings  are  not  disclosed  to  passengers to inform their choice of driver: passengers are not offered a choice of driver with, for example, a higher price charged for the services of a driver who is more highly rated. Rather, the ratings are used by Uber purely as an internal tool for managing  performance  and  as  a  basis  for  making  termination  decisions  where  customer feedback shows that drivers are not meeting the performance levels set by Uber.  This  is  a  classic  form  of  subordination  that  is  characteristic  of  employment  relationships.

A  fifth  significant  factor  is  that  Uber  restricts  communication  between  passenger and driver to the minimum necessary to perform the particular trip and takes  active  steps  to  prevent  drivers  from  establishing  any  relationship  with  a  passenger  capable  of  extending  beyond  an  individual  ride.  As  mentioned,  when  booking a ride, a passenger is not offered a choice among different drivers and their request is simply directed to the nearest driver available. Once a request is accepted, communication between driver and passenger is restricted to information relating to the ride and is channelled through the Uber app in a way that prevents either from learning the other's contact details. Likewise, collection of fares, payment of drivers and  handling  of  complaints  are  all  managed  by  Uber  in  a  way  that  is  designed  to  avoid any direct interaction between passenger and driver. A stark instance of this is the generation of an electronic document which, although styled as an "invoice" from the driver to the passenger, is never sent to the passenger and, though available to the driver, records only the passenger's first name and not any further details (see para 10 above). Further, drivers are specifically prohibited by Uber from exchanging contact details with a passenger or contacting a passenger after the trip ends other than to return lost property (see para 12 above).

Taking  these  factors  together,  it  can  be  seen  that  the  transportation  service  performed by drivers and offered to passengers through the Uber app is very tightly defined and controlled by Uber. Furthermore, it is designed and organised in such a way as to provide a standardised service to passengers in which drivers are perceived as substantially interchangeable and from which Uber, rather than individual drivers, obtains  the  benefit  of  customer  loyalty  and  goodwill.  From  the  drivers'  point  of  view, the same factors - in particular, the inability to offer a distinctive service or to set  their  own  prices  and  Uber's  control  over  all  aspects  of  their  interaction  with  passengers -  mean  that  they  have  little  or  no  ability  to  improve  their  economic  position  through  professional  or  entrepreneurial  skill.  In  practice  the  only  way  in  which they can increase their earnings is by working longer hours while constantly meeting Uber's measures of performance.

[Admiral Yi]

Minicab drivers set their own price?

[Sheilbh]

Minicab drivers set their own price?

It depends. Not always some are working for a minicab firm where it's normally set by the company. But you'll get indpedent operators who set their own prices (especially for the flat-fee trips to train stations/airports etc).

[Sheilbh]

Incidentally in UK news Prince Philip is in hospital and has been visited by Prince Charles. It was apparently precautionary, but I think there may be preparations for bad news. Someone clocked that all of the male new presenters on the BBC have been wearing black suits (with a colourful tie) and all of the women are in black outfits (with a colourful jacket or scarf) which suggests they've all been told to dress in a way that can easily move into all black to break news of a royal death.

For all his issues - and they are many - I always have a slight soft spot for people who fought literal Nazis So hope he gets better.

[Admiral Yi]

It depends. Not always some are working for a minicab firm where it's normally set by the company. But you'll get indpedent operators who set their own prices (especially for the flat-fee trips to train stations/airports etc).

OK, so we're back at the beginning.  I said some drivers were happy with the arrangement.  What does anything you've posted have to do with that?

[Sheilbh]

OK, so we're back at the beginning.  I said some drivers were happy with the arrangement.  What does anything you've posted have to do with that?

I never disputed that

My point was the Uber-driver relationship isn't the only one that matters - there's also their competitors in the market and it's not fair if one company isn't playing by the same rules. And that freedom over hours isn't determinative of employee or not.

As I say Uber have already changed their system in the UK since 2016 to try and get around this ruling (because at every stage the court's have been pretty decisive in dismissing Uber's arguments). So there's no workers affected by this ruling and there haven't been for 5 years. Drivers from before them can probably try and seek compensation in the inevitable class actions, which I imagine will also make them happy