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5 October 2017updated 09 Sep 2021 5:23pm

When will Transport for London challenge Uber on exploiting drivers?

Uber lost its London licence – but not because of its treatment of workers. 

By James Farrar

London’s mayor Sadiq Khan made headlines in September, after Transport for London decided not to renew Uber’s licence (it continues to operate freely in other cities). The Trades Union Congress hailed Uber’s delicensing as a “big win for workers’ rights”. Yet for many members of the Independent Workers Union of Great Britain, the prospect of losing their livelihood and facing unmanageable vehicle debt doesn’t seem like something worth celebrating.

Uber now has two quite separate existential legal battles on its hands, one to keep its licence to operate and the other to maintain a business model entirely dependent upon the exploitation of workers. The two legal battles are too often conflated. 

I was one of two former Uber drivers who took the company to court last year in an attempt to win workers’ rights. Myself and fellow driver Yaseen Aslam returned to court last week to fight Uber’s appeal of an earlier ruling in our favour, which confirmed our status as self-employed “limb (b) workers”. This is a technical term which means we have the right to earn the minimum wage and get holiday pay.

It’s a must-win battle, because if we lose there will undoubtedly be a rush to ape Uber style “partnerships”, with workers bearing all the risk in return for the notional flexibility of “being your own boss”. Too often, workers are confronted with an unfair and false choice between flexibility and fairness.

Uber’s market valuation is close to that of Unilever or Vodafone. Is guaranteeing the minimum wage really too much to ask? As for holiday pay, I never knew the true value of it before reaching the point of not being able to afford to stop working.

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Consider, too, the plight of my friend whose child is critically ill in hospital. He is struggling to keep the family unit together in a crisis, while knowing every minute he stays off the road his vehicle rental costs just keep racking up. For the very low earning, holiday allowance can provide much needed respite.

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In a remarkable volte-face last week, Uber argued at the Employment Appeals Tribunal that it is not the gig economy’s poster child, but a traditional minicab operator after all. Yet in 2014, Uber testified to the London Assembly that the traditional minicab business model is “brutally exploitative”, characterised by drivers who are “very low paid” working “long hours to earn a suitable” salary. I find it hard to disagree.

Uber’s runaway growth has coincided with a spectacular fall in driver earnings. Many drivers work up to 90 hours per week and earn little more than £5 an hour after costs. Drivers must spend ever more hours on the road just to make the same money. Labour MP Frank Field, in his own independent report, compared Uber workers to “sweated labour” of the Victorian era.

The market is now flooded, which has led to increased congestion and a shift of passengers away from public transport attracted by unsustainably cheap minicab fares. Uber benefits greatly from the network effects of a driver waiting on every corner. However, the external costs of this inefficiency are paid for by us all.

TfL stripped Uber of its licence after finding it “not fit and proper” to hold one. It cited several major reasons: a failure of process in medical  and criminal background checks, a failure to effectively co-operate with police in reporting passenger sexual assaults, and the use of a software tool called greyball to evade regulatory inspection by identifying known compliance officers and likely locations of pick up (Uber says that it does not use greyball to avoid UK regulators). 

While I agree that TfL is right to raise these important issues, it has singularly failed to challenge Uber on its exploitation of drivers and the negative knock-on effects this inevitably has on public safety. This sends all the wrong signals with competitors now poised to compete with or take Uber’s place. Taxify is expected to return to London soon and Lyft is planning its debut in the capital. Both app-based operators offer similar driver terms to Uber.

We believe TfL has made the wrong decision for the wrong reasons. In doing so, it failed to tackle the excesses of the gig economy’s most famous protagonist. If TfL sends Uber packing, it leaves drivers with a terrible choice: debt-burdened unemployment or a quick trip out of the frying pan and into the fire.

Things might have been different if the voice of minicab drivers was stronger at TfL. Today, 120,000 minicab drivers, of whom 80 per cent hail from London’s minority communities, pay in £20m per annum or 73 per cent of TfL’s total licence revenue. Yet these drivers are denied dedicated representation in TfL’s stakeholder process. In contrast, 23,000 taxi drivers have five recognised representative bodies. Operators have two, while Addison Lee and Uber are approved for direct access.

There are signs that tensions are easing, the mayor is softening his approach and Uber’s CEO jetted into town to patch things up. While things remain in flux, progress can still be made. However, the heavy lifting required to clean up the entire minicab industry should not be left to workers alone. Londoners deserve a transport system free of sweated labour.

Uber should stay in London and be forced to obey all employment and transport regulations, as a condition of licence renewal. In a market where labour abuses have festered for decades, there are few better alternatives for drivers and many much worse. In many ways, Uber’s poor record on compliance and workers’ rights is the logical outcome of a regulatory breakdown as much as it is the cause of it.

It’s not too late for the mayor and TfL to stand up for workers’ rights and, in doing so, forge a new model for the gig economy – one that finally reconciles flexibility with fairness.

James Farrar is chair of the Private Hire Drivers branch of the Independent Workers’ Union of Great Britain’s and the co-claimant in Aslam & Farrar vs Uber. 

Uber said in response to this article: 

“Almost all taxi and private hire drivers have been self-employed for decades before our app existed. With Uber drivers have more control and are totally free to choose if, when and where they drive with no shifts or minimum hours. The overwhelming majority of drivers say they want to keep the freedom of being their own boss. 

“Last year drivers using our app made average fares of £15 per hour after our service fee. We’ve recently invested in a number of changes, including discounted illness and injury cover, paid waiting time and the ability to cash out fares at any time.” 

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