Show Hide image Economy 17 January 2019 Tyranny of the algorithm: how Uber replaced one exploitative boss with another The message, from a driver’s perspective, is clear – take the work you are given, or you may find the quality and quantity of the work offered starts to deteriorate. By James Farrar Sign UpGet the New Statesman’s Morning Call email. Sign-up For centuries, the River Thames was London’s thoroughfare. Boats plied for hire to take the masses between the north and south banks. Others serviced many of the great houses, which often boasted sumptuous Venetian-style riverside gateways for passenger pick up and drop off. Traces of this industry remain today, at York House on the Strand. Its Watergate now stands in a park, now 100 metres from the river, but the 19th century painter Henry Pether captured it in a dreamy, moonlit London, its steps disappearing into the Thames. The regulation of the hire boats began as early as 1193, when the Corporation of London became Conservator of the Thames and began issuing licences. By 1370, the watermen needed licences, and in 1514 and 1555 further Acts of Parliament were passed to govern safety and fares. But then, in the 1630s, the first horse-drawn carriages appeared in London. The Company of Watermen, now firmly the establishment, complained bitterly about the threat to their livelihood, as well as pointing out the congestion in the streets. Charles I responded by restricting the numbers of Hackney carriages to no more than 50. Nevertheless, ranks of cabs started to appear. In 1654, Charles’s republican usurper, Oliver Cromwell, set up the Fellowship of Master Hackney Carriages and increased numbers allowed to 200. By 1711, there were more than a thousand hackney cabs in London. The disruption was complete. For the next three centuries, the natural way to call a taxi was to stand in the street and flag one down. And since taxi drivers were the only people legally licensed to ply for hire on the streets, their incumbency was secure. But in 1961, Carline Cabs spotted a loophole. The regulation, the company successfully argued, applied only to taxis who “ply for hire”. Carline Cabs, by contrast, took bookings in advance from customers who used the telephones increasingly installed in their own homes. And so, to this day taxi and minicabs are divided into a dual tier system – minicabs may take advance bookings only from a licensed operator, while taxis serve the instant hire market, use the bus lanes as well as rank and ply for work on the streets. **** When Uber arrived in London just before the 2012 Olympics, taxi drivers barely noticed the interloper – they were too busy disputing the prospect of Olympic-only lanes. Meanwhile, minicab drivers were locked in a world where they were chronically susceptible to exploitation. They had to work for licensed operators, and dispatch controllers at such minicab firms got to decide which drivers were “fed” good work and which were “starved”. At one firm, a controller was infamous for sending drivers to pick up fast food for him at peak times (the driver received no compensation for either the food or for the journey). Casual racism was also common, with firms accommodating unreasonable customer requests as to which ethnic group their driver must or must not belong to. It would be hard to see this dual tier system as anything more than a regulated form of industrial apartheid. In London, around 80 per cent of taxi drivers who declare ethnicity to TfL are classified as white British, according to a 2016 Freedom of Information request I submitted to Transport for London. In contrast, 94 per cent of minicab drivers are identified as BME according to TfL data. So when Uber arrived in the UK, the attraction for drivers was obvious. As Uber spread, drivers in some English cities were threatened by local minicab firms with blacklisting if they signed up. Others were threatened with a £1,000 “fine” if they ever wanted to return to local minicab work again. The mood in the early Uber training sessions was buoyant. When Uber staff assured the hundred or so recruits that “there are no controllers”, their speech would almost always be punctuated by a huge cheer. These hopes, though, were misplaced. Eventually, the apparent virtues dissipated, and Uber drivers realised the old boss of the controller had been replaced by a new one – the algorithm. **** One Uber advert targeted at drivers trumpets testimony from a smiling “Uber Partner” called Asif. I make 3 times more money compared to my previous courier driver job. With Uber, I don’t need to worry about bills. If my child wants a new jacket – I tell him, buy two if you want. But those who sign up enter a rhetorical hall of mirrors where nothing said or written can ever be taken at face value. The spin starts with the earliest enticement to join up and work in your spare time. But by definition, if you’re working in your spare time then it’s no longer really “spare time”. This goes to the heart of the gig economy lie – downplaying work by calling it a gig rather than a job. Those who are convinced must then sign a contract agreeing that Uber is not, in fact, a transportation provider. The hiring entity is a shell company in Amsterdam, and drivers must agree to binding arbitration there in the event of a dispute. But only some of the rules are set out in black and white. Others are “recommendations” to which we must comply, and many more are built and enforced by hidden algorithms. Once drivers enter the Uber corporate offices, the clash of culture is jarring. The Uber staff, Shoreditch hipster types with backgrounds in management consultancy, are unfailingly professional and polite, but quite unused to being challenged by drivers. I discovered this myself in 2015 when, after an assault, I asked for a meeting with a senior manager. I wanted an explanation as to why it took Uber ten weeks to cooperate with the police to identify the passenger who assaulted me. The manager suggested I was attempting to “reverse audit” their safety processes, and I had to switch my phone on and off to prove I wasn’t making a surreptitious recording. (In 2018, Uber announced it will now report serious incidents directly to the police, and create a 24/7 hotline for riders and drivers.) In theory, Uber offers the flexibility of working when and where drivers want. In reality, the flexibility is greatly tempered by financial pressure to work enough hours to cover high overhead costs and make a decent return. A driver who decides to rent a Toyota Prius Hybrid from one of the leading rental firms for licensed private hire vehicles, Otto Cars, must pay £239 a week with insurance, plus a deposit and insurance excess. Even if, in an optimistic scenario, a driver earns £18 per hour in gross fares, minus 25 per cent commission, a driver would need to work for 18 hours per week before covering the fixed rent on the vehicle, and would take home just £3.56 an hour based on a 40-hour week. It is because of the high overhead costs that minicab drivers must work very long hours to earn a worthwhile return. Independence? Of a limited kind, maybe. Freedom? Hardly. **** Uber insists that drivers are completely free to refuse jobs, but the current cancellation policy is unambiguous: “Uber reserves the right to enforce a breach of your contractual agreements or restrict access to the platform if you are found to be in breach of the cancellation policy.” This policy is enforced through soft nudges on the app. I received messages such as: “Your confirmation rate is based on the percentage of trip requests you confirm. High rates don’t affect your account but often mean shorter waiting times.” The message, from a driver’s perspective, is clear – take the work you are given, or you may find the quality and quantity of the work subsequently offered starts to deteriorate. This sets up a dilemma for a jobbing driver. Should I accept a job 24 minutes away that might just yield me just £4 for an elapsed time from dispatch to finish of 45 minutes? Or risk having the algorithm slowly start to make me a “starved driver”? In attempting to log off, sometimes a nudge is used to keep you on the job. I once drove a 12-hour night shift covering more than 250 miles from Gatwick in the South to Stansted and all parts in between. As I attempted to log off I got this message: “Are you sure you want to go offline? Demand is very high in your area. Make more money. Don’t stop now!” And why not? After all, the risk of fatigue-related accidents will be borne by the passenger and driver alone. And yet, Uber monitors driving behaviour and gives drivers a daily performance report on the quality of acceleration and braking activity. As a concession to keep its license in London, Uber has placed a restriction of ten working hours, but this is just the hours on a trip. Waiting and positioning pushes the actual working time much higher. Uber sends drivers constant warnings about the illegality of using a mobile phone while driving. Yet its own messaging system pressures drivers to interact with the app while driving to confirm the next job while still on the current one. The message says: “you recently missed requests that came in during other rides. Next time accept the request…” Perhaps the biggest nudge of all is Uber’s dynamic pricing, more commonly known as “the surge”. At times of high demand, Uber increases the price by two or three times. It argues that this is the best way to ensure any customer can access a car. In reality, what happens on a typical Saturday night is a cat and mouse game between the driver and customer. Drivers log out until the surge comes on, and then they log in. But customers are increasingly conditioned to wait, knowing the surge will soon pass. When the surge falls away the drivers log out again. Uber takes a dim view of such driver behaviour, which it describes as “gaming the surge”, a disciplinary offence. While Uber paints itself as a Randian poster child of the free market, free economic choice is denied to the drivers it insists are sovereign. This goes to the heart of Uber’s dysfunctional relationship with drivers – it wants complete power over workers but none of the attendant responsibilities. This double standard is reflected in government, too. At a 2018 Demos forum on the gig economy, Liz Truss, chief secretary to the Treasury, declared herself to be “an Uber riding, Deliveroo eating, Airbnb-ing freedom fighter for the gig economy”. I asked her if she would honour the current legal position, as established in law and confirmed by the judgement against Uber, that platform workers should be guaranteed the minimum wage for every hour logged on. She dodged, diverted and waffled but never answered. It would seem the minister’s fight for freedom in the gig economy doesn’t extend to the freedom for workers to earn the minimum wage and be protected by employment law. **** Perhaps the most troubling Uber tactic of all is the outsourcing of performance management. It is the customers who decide how well drivers have performed, but the standards are incredibly high. Leaked internal documents from Uber in 2015 revealed that drivers with a customer rating of 4.6 or below risked termination of their contract, or in the Uber vernacular, “deactivation”. Today, Uber guidelines aimed at US drivers acknowledge the possibility that “your account has been deactivated for quality reasons like low star ratings”. In the UK, Uber’s guidelines state that there is a minimum rating in each city “because there are cultural differences in the way people in different cities rate each other”. Drivers approaching the minimum, if notified multiple times, may “in some cases be deactivated”. Drivers hovering around the critical ratings threshold will avoid the surge, knowing full well that ratings tank when customers are asked to pay multiples of the normal fare. Others resort to handing out free bottles of water and sweets in a desperate attempt to boost ratings. Uber encourages this, by suggesting customers award drivers worthless electronic badges in recognition of their generosity in having a “well stocked car’” for free. For drivers earning about £5 per hour, the extra cost is explained as follows: Riders don’t expect extra items, but providing bottled water or a snack could really make someone’s ride special. As usual, Uber’s guidance on acceptable ratings for drivers is as clear as mud. In a recent podcast, Uber managers interpret the ratings as follows: 1 star means “terrible” service. 2 stars means “bad trip” 3 stars means “pretty disappointing” 4 stars means “its ok but you did have a problem” 5 stars means ‘excellent’ The nonsense of Uber’s driver rating system comes into sharper relief when you compare it to the popular film review rating system, Rotten Tomatoes. Alfred Hitchcock’s Vertigo is classified by the British Film Institute as number one in a list of the 50 greatest films ever made – and yet the Rotten Tomatoes audience rating for the same film is just 4.2 out of 5. If Uber was a film distribution company, Vertigo would never be shown again. Being ejected from Uber’s platform for whatever reason can be devastating. Uber’s market domination is now such that most drivers working for smaller firms need it to at least supplement their income. Drivers who are dropped first learn about it when they are blocked from logging in. There’s no number to call, so he or she must simply email, or wait for a phone call. When that call comes, it will be from Uber staff at a remote service centre using vague, nonspecific scripts. This is quickly followed by a contact termination letter citing your failure to follow their community standards. Other times, you simply get the bad news by in-app message. In an effort to win back and keep its license, Uber has been busy “deactivating” drivers for any number of infractions both great and small. All are automatically referred to Transport for London for it to consider further action. Drivers are summarily dismissed without recourse, but TfL can be impressed that Uber is at least now policing its platform. The dismissal of workers at Uber has been highly automated and scripted. At our initial Employment Tribunal in July 2015, Uber’s then-general manager, Jo Bertram gave oral evidence detailing the process. In a surreal moment she described how the “deactivation” process was mostly a manual process in 2014. But by the following year, her team had managed to mostly mechanise it. In response to my article, an Uber spokeswoman said: “Almost all taxi and private hire drivers have been self-employed for decades, long before our app existed. A recent Oxford University study found that drivers make more than the London Living Wage and want to keep the freedom to choose if, when and where they drive. If drivers were classed as workers they would inevitably lose some of the freedom and flexibility that comes with being their own boss.” **** Uber continues to claim it is a tech intermediary agent for the driver, rather than a transport provider. This allows Uber to avoid any employment-associated costs or liability, to avoid sales taxes such as VAT, and to avoid locally administered transport regulations. In today’s investor market, it is perhaps also convenient to be an internet service with viral growth, rather than a far less glamorous transport company. But we must separate the necessary disruption that often comes with innovation from the disruption caused by illegal and abusive corporate behaviour. Too often we accept the latter as a deterministic outcome of the former. In 2016, we won our case at the Employment Tribunal. This confirmed we are “limb-b workers” under the law, sort of a half-way house between employment and self-employment in business on your own account. Crucially, it gives us the right to holiday pay, the right to the minimum wage and whistle-blower protection. In 2017, we went back to court with the support of the IWGB union to successfully see off Uber’s appeal later. Late last year we defeated Uber at the Court of Appeal where the judgement witheringly eluded to the “air of contrivance and artificiality which pervades Uber’s case”. Last month the government set out its wholly inadequate plans to address the abuses of gig economy employers. But the heart of the problem is not the law made obsolete by technology, but the abject failure to enforce it. The government still has not committed adequate resources for future enforcement, which means workers will continue to have to take on firms like Uber alone. For decades, fiercely independent London cabbies fought to preserve the two-tier system of taxi and private hire. They fought against Uber to stop minicab drivers from encroaching on their domain, to stop us becoming like them. Now it appears, technology is making them more like us. Apps like MyTaxi and Gett are making the need for ranks and a street hail a thing of the past. Yet MyTaxi and Gett also take commission cuts, allowing customers to rate cabbies, and are “deactivating” taxi drivers. Now we see the launch of the first worker rights claim by a taxi driver against MyTaxi just like ours against Uber. And the changes keep on coming. Uber CEO Dara Khosrowshahi recently told Chris Grayling that the company wants to become a “fully integrated transport platform” dominating many more transport modes. Soon Uber will launch a commuter van service in the UK called Uber Pool Express. One wave of disruption in the long history of transport in London is almost complete. Another is just getting underway. Subscribe For daily analysis & more political coverage from Westminster and beyond subscribe for just £1 per month!