Tag Archives: uber

California Court Affirms Right To Treat Uber And Lyft Drivers as Contractors

Legal, , , ,

Uber Technologies Inc., Lyft Inc. and other companies scored a victory with a California court ruling that preserves their independent contractor model in the state and could boost their efforts to maintain that model elsewhere, The Wall Street Journal reported.

A state appeals court reversed a lower-court ruling that found a California ballot measure known as Proposition 22 illegal. Proposition 22, which passed in November 2020, allowed these companies to continue to treat their drivers as independent contractors.

According to the Wall Street Journal, Uber and others are in a global tug of war with regulators over whether and how to grant more benefits such as paid sick leave and health insurance to workers in the so-called gig economy, where apps distribute individual tasks to a poll of people whom companies generally regard as independent contractors.

California sued Uber and Lyft in 2020, saying they were in violation of a new state law that sought to reclassify their drivers as employees. A legal battle ensued, culminating in Proposition 22, in which Uber, Lyft, DoorDash Inc. and Instacart Inc. asked state voters to exempt them from the law. The companies spent a record amount of money for a California ballot measure, about $200 million.

The New York Times reported that the decision by three appeals court judges overturned the ruling late last year by a California Superior Court judge, who said the Proposition was “unenforceable.” It was a victory for companies like Uber, which use gig drivers to transport passengers and to deliver food, but does not pay costs that an employer would have to. Those costs can include drivers’ unemployment insurance, health insurance, and business expenses.

According to The New York Times, the appeals court ruling was not the final say. The Service Employees International Union, which, along with several drivers, filed a lawsuit challenging Proposition 22 in early 2021, is expected to appeal the decision to the California Supreme Court, which would then have several months to decide whether to hear the case.

The opponents of the proposition argued that the ballot measure was unconstitutional under several grounds. It set limits on the State Legislature’s ability to oversee workers’ compensation for gig drivers. It included a rule restricting them from collective bargaining that critics said was unrelated to the rest of the measure, and it set a seven-eights majority vote of the Legislature as a bar for passing amendments to the measure related to collective bargaining – a requirement that was considered nearly impossible to achieve.

CNBC reported that Proposition 22 created a set of criteria which determined whether ride-share drivers were employees or independent contractors. In practice, it exempted Uber and similar companies from following certain minimum wage, overtime, or workers compensation laws for hundreds of thousands of Californian rideshare drivers.

Instead, according to CNBC, the ballot measure required companies to provide compensation and healthcare “subsidies” based on “engaged” driving time, as well as the benefits, including safety training as “sexual harassment training.”

To me it sounds like Uber, Lyft, DoorDash, and Instacart are desperately trying to suppress drivers ability to form a union, (also known as “collective bargaining”). Unionization would require the large companies to provide drivers with the same types of benefits that other workers, who have unionized, would be expected to receive. It also make it harder for the big companies to fire them.

Uber Investigating Breach Of Its Computer Systems

Hacker

Uber discovered its computer network had been breached on Thursday, leading the company to take several of its internal communications and engineering systems offline as it investigated the extent of the hack, The New York Times reported.

The breach appeared to have compromised many of Uber’s internal systems, and a person claiming responsibility for the hack sent images of email, cloud storage and code repositories to cybersecurity researchers and The New York Times.

According to The New York Times, an Uber spokesman said the company was investigating the breach and contacting law enforcement officials. Uber employees were instructed not to use the company’s internal messaging service, Slack, and found that other internal systems were inaccessible, said two employees, who were not authorized to speak publicly.

Shortly before the Slack system was taken offline on Thursday afternoon, Uber employees received a message that read, “I announce I am a hacker and Uber has suffered a data breach.” The message went on to list several internal databases that the hacker claimed had been compromised.

Uber tweeted on September 15, 2022: “We are currently responding to a cybersecurity incident. We are in touch with law enforcement and will post additional updates here as they become available.”

The Verge reported that the alleged hacker, who claims to be an 18-year-old, says they have administrator access to company tools including Amazon Web Services and Google Cloud Platform.

When contacted by The Verge for comment, a spokesperson for Uber declined to answer additional questions, and pointed to its statement on Twitter.

The Washington Post reported that after the hacker posted a message on Uber’s Slack, it was followed by a flurry of reaction emoji, including several dozen showing what appeared to be a siren symbols. Because of the hack, people said, some systems including Slack and internal tools had been temporarily disabled.

The Washington Post obtained internal screenshots that showed the hacker claiming to have wide-ranging access inside Uber’s corporate networks and appeared to indicate the hacker was motivated by the company’s treatment of its drivers. The person claimed to have taken data from common software used by Uber employees to write new programs.

According to The Washington Post, the hacker’s ominous posts were met with reactions apparently depicting the SpongeBob character Mr. Krabs, the popular “It’s Happening” GIF and queries as to whether the situation was a prank.

The Wall Street Journal reported that a hacker, identified only by the Telegram handle Tea Pot, gained control of Uber’s account with HackerOne, a firm that helps companies work with security researchers, according to the company and researchers on their platform. The hacker provided security researchers with screenshots that appeared to show widespread access to a range of administrative accounts that manage Uber’s technology systems, including the Amazon Web Services and Google clouds, as well as VMware systems, the researchers said.

Other than the HackerOne account compromise, The Wall Street Journal couldn’t verify Tea Pot’s other claims.

At the time I am writing this post, Uber has not provided any updates on their Twitter account. Perhaps they will later today. That said, if you were planning to go somewhere via Uber today – there’s a good chance that you won’t be able to obtain a ride from the company’s drivers. Consider Lyft or the local bus service wherever you are.

Uber Is Ending Its Uber Rewards Program

Information

Uber is ending its free loyalty program, Uber Rewards, so it can turn its attention to its subscription-based Uber One membership, The Verge reported. According to The Verge, Uber sent an email to customers explaining that users can still earn points until the end of August, and that the last day to redeem points is October 31st.

The Verge posted part of that email:

“Thank you for being part of Uber Rewards. It’s been a great ride, but we’ve decided to end our Rewards soon, as we shift our focus to our new Uber One membership program.

“You will still earn points and enjoy Rewards benefits until the end of the month. And there’s still time to get all the rewards you’ve earned: just use your points by October 31. You can redeem them from the Account section of your Uber and Uber Eats apps.

“As a valued member, you’ll also receive 1 free month of Uber One, giving you members-only savings and perks on Uber and Uber Eats. Join Uber One in the Account section of your app.

“Thank you for being a loyal Uber customer.”

What is Uber One? Uber describes it as “One membership to save on Uber and Uber Eats”. It offers the following:

  • Unlimited $0 Delivery Fee on Uber Eats
  • Get 5% off and top-rated drivers on Uber
  • Up to 10% off eligible Uber Eats deliveries and pickup orders
  • Uber One Perks including special offers and promotions

As always, you should read the fine print before deciding if you want pay for Uber One.

It costs $9.99/month or $49.99/year. A free trial of Uber One is available – but only for first time members. Membership will auto-renew every month (if you choose a monthly membership) or every year (if you choose an annual membership) beginning on your enrollment date.

This could mean that a person who used the free trial will automatically be billed for Uber One – until and unless they cancel it. Keep in mind that the free trial doesn’t cost anything – but after the time limit ends – you should expect to be billed for your Uber One membership.

Fortunately, you can cancel your renewable membership. But, you can only cancel your Renewable Membership up to 48 hours prior to your next scheduled payment to avoid further charges. This information was in the fine print at the bottom of the https.//uber.com/us/en/u/uber-one website.

Uber One benefits are available only for eligible stores marked with the Uber One icon. $15 minimum order to receive $0 Delivery fee and up to 10% off from participating non-grocery stores, and $30 minimum on participating grocery stores for $0 Delivery Fee where grocery is available. 

Uber One discounts are not available for rides booked 30 minutes or more in advance. It is also worth noting that Uber One is available within the United States. If you travel outside of the U.S., your Uber One membership might not be accepted.

Uber Sells its Self-Driving Car Unit to Aurora

Transportation

Uber Technologies Inc. sold its self-driving-car unit to a Silicon Valley competitor, Aurora Innovation Inc., The Wall Street Journal reported. This appears to be an attempt by Uber to deliver on a promise to his shareholders to become profitable.

The two companies on Monday said that as part of the deal for the self-driving-car unit, known as Advanced Technologies Group, or ATG, Uber will make a $400 million cash investment in Aurora. Uber said it would hold a roughly 26% stake in Aurora on completion of the deal. Uber Chief Executive Dara Khosrowshahi also is joining the company’s board of directors.

According to The New York Times, “The deal amounts to a fire-sale to a high-profile but star-crossed effort to replace Uber’s human drivers with machines that could drive on their own.”.

The New York Times pointed out that Uber’s self-driving car projects led to the death of a pedestrian in Arizona; a lawsuit from Waymo, the self-driving car company owned by the same parent company as Google; and a guilty plea from a former Uber executive accused of stealing intellectual property.

This year, Uber and Lyft (together) spent almost $200 million to convince California voters to vote “yes” on Proposition 22. In short, Prop 22 (if it passed) would define app-based transportation (rideshare) and delivery drivers as independent contractors and adopt labor and wage policies specific to app-based drivers and companies. If Prop 22 failed, Uber and Lyft would have to pay their workers as employees – with benefits.

The ride-sharing companies got what they wanted when Proposition 22 passed. Curbed wrote: “Uber and Lyft have proved they are able to outright purchase legislation that allows them to shape local transportation policy while actively undermining existing services. Prop 22 demonstrates that not only do Uber and Lyft no longer have to play by the rules, they can now write their own.”

What will Aurora Innovation Inc., do with Uber’s self-driving-car unit? The Wall Street Journal reported that Aurora will focus on the rollout of self-driving technology for heavy-duty trucks. Autonomous passenger vehicles will follow.

Judge Grants Uber and Lyft a Temporary Stay

Legal,

The ongoing battle between ride-sharing companies Lyft and Uber,and the state of California, continues with an appeals judge extending a temporary stay, CNBC reported. This gives Uber and Lyft more time in which to comply with an order requiring the companies to reclassify their drivers as employees.

The situation began with a California law called AB5, when went into affect on January 1, 2020. It requires companies that hire independent contractors to reclassify them as employees.

On August 10, 2020, California Superior Court Judge Ethan Schulman ordered Uber and Lyft to reclassify their contract drivers as employees with the same protections and benefits as other staffers. Those workers would be entitled to workers comp, unemployment, paid sick and family leave, and health insurance.

AB5 allows independent contractors to be classified as employees if the employers can verify that that the worker performs work that is outside the usual course of the hiring entity’s business (among other things).

It seems to me that Uber and Lyft, both of whom are ride-sharing companies, are going to have a difficult time trying to convince a judge that their workers are performing work that is outside the usual course the hiring entity’s business. The workers are driving their own vehicles and picking up and dropping off passengers. That’s literally the main purpose of ride-sharing companies!

Both Lyft and Uber posted blogs that can be summarized as a threat to users of their services. Each made it clear that they would shut down service in California. The blog posts also push people to vote for Proposition 22 which, if it gets enough votes, would reverse AB5. Lyft later updated their blog post to note that rideshare is back on, thanks to the stay.

As a person who lives in California, and who is also disabled, I think Lyft and Uber should not have threatened users with a stoppage of service. I rely on them to get me to and from appointments with health care providers. It feels like Uber and Lyft never bothered to consider how an abrupt stoppage of service could become a huge difficulty for people who cannot drive.

The Guardian reported that Proposition 22 has millions of dollars in backing from Uber and Lyft as well as other gig economy firms that are affected by the law. It appears that Lyft and Uber have plenty of money to fund Proposition 22 – which directly benefits them and harms their workers. They should use that money to do the right thing and comply with AB5.

California Bill AB5 Turns Contract Workers into Employees

Law, , , ,

California’s Assembly Bill 5 (AB5) will reclassify many contract workers in California into full employees with benefits. It doesn’t cover all types of contract workers, and is anticipated to affect companies like Uber and Lyft the most.

The New York Times reported that AB5 passed the California State Senate in a 29 to 11 vote. California’s Governor, Gavin Newsom, endorsed the bill this month and is expected to sign it. If signed, the measure will go into effect on January 1, 2020. State Senator Maria Elena Durazo (Democrat – Los Angeles) authored the bill.

The bill redefines “employee” using an existing law that includes an “ABC” test to establish whether a worker is an independent contractor or an employee. It says a worker is an employee if the worker’s tasks are performed under a company’s control; those tasks are central to that company’s business; and the worker does not have an independent enterprise in that trade.

Those who are considered employees under this bill will have access to basic protections such as a minimum wage, unemployment insurance, and perhaps access to health insurance coverage.

Personally, I am an independent contract worker – not an employee. None of the work I do for a living could be considered “central to that company’s business”. That said, people who are part of the gig economy and who drive for companies who produce ride-hailing apps, could be considered employees. They are doing the work that is central to the the business of Uber, Lyft, and DoorDash.

According to The New York Times, Uber and Lyft have “repeatedly warned that they will have to start scheduling drivers in advance if they are employees, reducing drivers’ ability to work when and where they want”. But, this is nonsense. There is absolutely nothing in AB5 that requires companies to “schedule drivers in advance”. It is possible that Uber and/or Lyft will retaliate by raising the prices for rides – but this will ultimately backfire because public transit is always going to be less expensive.

There are lists of professions who are exempt from AB5. Those professions include: doctors, dentists, psychologists, insurance agents, stockbrokers, lawyers, accountants, engineers, direct sellers, real estate agents, hairstylists, commercial fisherman, travel agents, and graphic designers.

Uber Settles Discrimination Lawsuit

cars, Law, , ,

uberlogo[1]Ride-sharing service Uber agreed to settle a lawsuit brought against them by the National Federation of the Blind. The suit contended that Uber was engaging in discriminatory practices by refusing to pick up blind passengers with service dogs. The settlement is still being reviewed by a judge and pending approval. The terms of the settlement force Uber to notify all of its drivers that they must take all passengers with service animals. The suit also awards $225,000 to the National Federation of the Blind over three years.

From a statement released by Uber:

As part of this settlement, we have agreed to take steps to make clear to drivers using Uber that they are obligated to transport to any passenger with a service animal. If the settlement is approved, drivers will see a pop-up in the Uber app reminding them of this obligation. We will also send periodic email reminders to drivers.

We have also agreed to publish a service animal policy which, in addition to our code of conduct and new deactivation policy, makes clear that any driver found to have refused someone with a service animal will be barred from using the Uber platform.

The National Federation of the Blind will deploy blind passengers with service animals to help test the new measures put in place by the settlement.