tag:theconversation.com,2011:/uk/topics/uberx-17238/articlesUberX – The Conversation2024-03-26T10:06:52Ztag:theconversation.com,2011:article/2265052024-03-26T10:06:52Z2024-03-26T10:06:52ZUber has settled a class action lawsuit for $270 million – what was it accused of?<p>Who’d want to go back to the days before Uber? The days in which you could never be certain you could get a taxi, the days of long wait times trying to order one on the phone, and the days in which you would never know for sure how your driver would treat you.</p>
<p>So much has Uber improved the experience of getting a ride (young people rely on it in a way their parents were never able to rely on taxis) that it might seem incomprehensible Uber has just agreed to pay almost <a href="https://www.mauriceblackburn.com.au/media-centre/media-statements/2024/uber-class-action-settlement-agreed-subject-to-approval/">A$272 million</a> to stop a class action against it going to court.</p>
<p>The $271.8 million settlement is the fifth-largest in Australia, eclipsed only by two for Victoria’s 2009 Black Saturday bushfires, one for Queeensland’s 2011 floods and one for Johnson & Johnson for defective pelvic mesh implants.</p>
<p>So what exactly did Uber do wrong – or at least be so unwilling to defend it was prepared to pay a quarter of a billion dollars not to have <a href="https://www.supremecourt.vic.gov.au/areas/group-proceedings/andrianakis-v-uber">aired in court</a>?</p>
<p>The <a href="https://www.supremecourt.vic.gov.au/sites/default/files/2022-08/Second%20Further%20Amended%20Statement%20of%20Claim%20%2824%20June%202022%29.pdf">statement of claim</a> presented on behalf of 8,000 taxi drivers and licence holders to the Supreme Court of Victoria paints a picture of an organisation prepared to break the law in order to build a large base of customers it could use to lobby to change the law to make what it had been doing legal.</p>
<h2>‘Greyballing’ and ghost cars</h2>
<p>The statement of claim points to internal Uber documents that indicate Uber knew in advance of its 2014 launch that its so-called UberX drivers were not licensed to operate commercial passenger vehicles, and that the fines were small.</p>
<p>Its aim was to quickly get to 2,000 trips per week in both Melbourne and Sydney, to ensure it had “as many people as possible to support UberX leading up to what will <a href="https://www.mauriceblackburn.com.au/content/dam/mbl/en/class-actions/current/uber/andrianakis_v_uber_technologies_inc_ors_taxi_apps_pty_ltd_v_uber_technologies_inc_ors_2022_vsc_196_redacted.pdf.coredownload.pdf">inevitably be a regulatory fight in both cities</a>”.</p>
<p>Uber told drivers it would pay their fines, and in Victoria paid <a href="https://www.smh.com.au/technology/uber-pledges-to-pay-1700-ridesharing-driver-fines-in-victoria-20140523-zrlnh.html">$1,732</a> at a time.</p>
<p>The class action said where inspectors tried to collect evidence, Uber engaged in a practice known as “<a href="https://www.mauriceblackburn.com.au/content/dam/mbl/en/class-actions/current/uber/andrianakis_v_uber_technologies_inc_ors_taxi_apps_pty_ltd_v_uber_technologies_inc_ors_2022_vsc_196_redacted.pdf.coredownload.pdf">greyballing</a>” in which the apps of selected users get shown a <a href="https://www.bbc.co.uk/news/resources/idt-f2971465-73d2-4932-a889-5c63778e273d">fake view</a> of ghost cars that won’t stop for them.</p>
<p>The claim said Uber also used “<a href="https://www.mauriceblackburn.com.au/content/dam/mbl/en/class-actions/current/uber/andrianakis_v_uber_technologies_inc_ors_taxi_apps_pty_ltd_v_uber_technologies_inc_ors_2022_vsc_196_redacted.pdf.coredownload.pdf">blackout geofences</a>” that made it impossible to hire Ubers near the buildings used by enforcement officers and regulators.</p>
<h2>Case settled at the last moment</h2>
<p>By settling <a href="https://www.mauriceblackburn.com.au/media-centre/media-statements/2024/uber-class-action-settlement-agreed-subject-to-approval/">just before</a> the case went to court, Uber managed to avoid these claims being tested, and also managed to avoid the court airing the <a href="https://www.washingtonpost.com/business/2022/uber-files-investigation/?itid=lk_inline_manual_8">trove of documents</a> leaked two years ago in which one international Uber executive joked he and his colleagues had become “<a href="https://www.theguardian.com/news/2022/jul/10/uber-files-leak-reveals-global-lobbying-campaign">pirates</a>” and another conceded: “we’re just f***ing illegal.”</p>
<p>Uber succeeded in getting each state’s laws changed, at a cost of devaluing to near zero taxi licences reported to have been worth as much as <a href="https://www.smh.com.au/technology/uber-s-ugly-truths-laid-bare-with-300-million-capitulation-20240320-p5fduj.html">$500,000</a> each.</p>
<p>But in its defence (and I may as well defend Uber because it decided not to in court) most taxi drivers never paid anything like $500,000.</p>
<p>And taxis provided a pretty poor service. That’s because the number in each state was limited, which helped ensure drivers had work, but worked against customers in two ways – it ensured there weren’t enough taxis available at busy times, and by pushing up the price of licences it pushed up the price of fares.</p>
<h2>Taxis served cities poorly</h2>
<p>In a landmark 2012 report, <a href="https://apo.org.au/sites/default/files/resource-files/2012-09/apo-nid32345_0.PDF">Customers First</a>, two years before the arrival of Uber, former competition chief Allan Fels recommended Victoria issue licences without limit, charging a simple fee of about $20,000 per year for anyone who wanted one.</p>
<p>It’s this recommendation, adopted by Victoria and publicised in other Australian states, that began devaluing licences before the arrival of Uber.</p>
<p>And the Fels report found most of the owners of licences weren’t drivers. </p>
<p>Most were <a href="https://apo.org.au/sites/default/files/resource-files/2012-09/apo-nid32345_0.PDF">passive investors</a>, some of whom had done well by punting that the value of their licences would rise, and all of whom should have taken into account the possibility the value could fall.</p>
<h2>Uber has gone mainstream</h2>
<p>Now that Uber has won the right to do what was illegal (and settled a class action that would have exposed how it did it), it has lifted its prices to <a href="https://www.smh.com.au/national/nsw/are-taxis-or-ubers-more-expensive-for-trips-across-sydney-20240319-p5fdna.html">something closer</a> to taxi fares and allowed customers to <a href="https://www.smh.com.au/technology/uber-s-ugly-truths-laid-bare-with-300-million-capitulation-20240320-p5fduj.html">book taxis from its platform</a>.</p>
<p>It has become mainstream in other ways. In Australia, it has entered into an agreement with the Transport Workers’ Union on employment, and in the US it wants to work with transport authorities to replace <a href="https://www.bloomberg.com/news/articles/2021-01-26/what-to-make-of-uber-s-bid-to-help-public-transit">lightly used bus services</a>.</p>
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Read more:
<a href="https://theconversation.com/gig-economy-workers-set-for-new-protections-in-albanese-governments-legislation-introduced-next-week-212541">Gig economy workers set for new protections in Albanese government's legislation introduced next week</a>
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<p>The path Uber has forged – becoming an outlaw, building public support for a change in the law, then becoming entrenched – has become something of a model for new firms in all sorts of other industries, from <a href="https://iclg.com/practice-areas/gambling-laws-and-regulations/australia">online gambling</a>, to <a href="https://www.afr.com/technology/bill-to-regulate-crypto-sector-introduced-to-australian-parliament-20230329-p5cwbo">cryptocurrency trading</a> to <a href="https://www.9news.com.au/national/electric-scooter-rules-in-australia-state-by-state-explainer/293a31b0-648e-4b5f-97c3-e5ac22c59a8c">footpath scooters</a>.</p>
<p>Uber has shown it works. In this case, the class action has shown that ultimately there can be a cost, but it took a long time and it wasn’t at all certain until the last moment that Uber would buckle.</p><img src="https://counter.theconversation.com/content/226505/count.gif" alt="The Conversation" width="1" height="1" />
<p class="fine-print"><em><span>Peter Martin is Economics Editor of The Conversation. </span></em></p>The just-settled lawsuit accused Uber of knowing that its drivers were breaking the law, paying their fines and “greyballing” investigators.Peter Martin, Visiting Fellow, Crawford School of Public Policy, Australian National UniversityLicensed as Creative Commons – attribution, no derivatives.tag:theconversation.com,2011:article/1583392021-05-06T14:00:55Z2021-05-06T14:00:55ZHow Uber drivers avoided — and contributed to — the fate of taxi drivers<figure><img src="https://images.theconversation.com/files/399220/original/file-20210506-15-1tloaa.jpg?ixlib=rb-1.1.0&rect=0%2C1699%2C5121%2C1715&q=45&auto=format&w=496&fit=clip" /><figcaption><span class="caption">Why have Uber drivers been regarded more favourably than taxi drivers?</span> <span class="attribution"><span class="source">Lexi Anderson/Unsplash</span></span></figcaption></figure><p>Countries <a href="https://theconversation.com/british-uber-driver-win-is-promising-but-gig-workers-still-need-basic-rights-155626">around the world</a> are wrestling with whether to classify Uber drivers and other gig economy workers as <a href="https://theconversation.com/californias-gig-worker-battle-reveals-the-abuses-of-precarious-work-in-canada-too-149780">independent contractors or employees</a>. </p>
<p>But when Uber first came on the scene, the primary subject of debate was whether its drivers were, in fact, taxi drivers. Why was this <a href="https://www.cbc.ca/news/canada/toronto/uber-brokerage-licence-1.3416343">ride-sharing or ride-hailing</a> app run by a <a href="https://www.thestar.com/business/2015/05/04/uber-taxi-firms-need-to-co-exist-says-mayor-john-tory.html">tech firm also applying to be a taxi company</a>? Was Uber truly “<a href="https://theconversation.com/the-same-but-different-what-passengers-like-about-uber-101676">the same as a taxi, but different</a>?”</p>
<p>We’ve studied how Uber and taxi drivers have been affected by Uber’s categorization as a technology company. As organizational and management researchers at business schools from across Canada studying stigma, marginalization and inequality as well as entrepreneurship, innovation and technology, we became very interested in Uber’s entry into the taxi industry as we watched it unfold.</p>
<figure class="align-center ">
<img alt="The CN Tower in the side-view mirror of a car" src="https://images.theconversation.com/files/396922/original/file-20210424-15-u4fkwu.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&fit=clip" srcset="https://images.theconversation.com/files/396922/original/file-20210424-15-u4fkwu.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=600&h=398&fit=crop&dpr=1 600w, https://images.theconversation.com/files/396922/original/file-20210424-15-u4fkwu.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=600&h=398&fit=crop&dpr=2 1200w, https://images.theconversation.com/files/396922/original/file-20210424-15-u4fkwu.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=600&h=398&fit=crop&dpr=3 1800w, https://images.theconversation.com/files/396922/original/file-20210424-15-u4fkwu.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&h=501&fit=crop&dpr=1 754w, https://images.theconversation.com/files/396922/original/file-20210424-15-u4fkwu.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=754&h=501&fit=crop&dpr=2 1508w, https://images.theconversation.com/files/396922/original/file-20210424-15-u4fkwu.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=754&h=501&fit=crop&dpr=3 2262w" sizes="(min-width: 1466px) 754px, (max-width: 599px) 100vw, (min-width: 600px) 600px, 237px">
<figcaption>
<span class="caption">The CN Tower is seen in the side-view mirror of a car.</span>
<span class="attribution"><span class="source">(Daniel Novykov/Unsplash)</span></span>
</figcaption>
</figure>
<p>In Toronto, Uber <a href="https://www.cbc.ca/news/canada/ottawa/uber-legalization-city-council-vote-passes-1.3533537">was eventually legalized</a> in 2016 after “<a href="https://www.thestar.com/news/city_hall/2016/05/03/toronto-city-council-debates-uber-rules.html">months of protest and turmoil</a>” and <a href="https://www.cbc.ca/news/canada/ottawa/taxi-driver-protest-against-uber-ends-at-city-hall-1.3230160">years of debate</a> while it <a href="https://globalnews.ca/news/1678342/city-to-announce-developments-regarding-uber-service-in-toronto/">operated illegally</a>.</p>
<p>But when we began studying Uber’s entry into Toronto, we noticed something concerning. There was increasing praise in the media for Uber and Uber drivers, but criticism and <a href="https://www.sshrc-crsh.gc.ca/society-societe/storytellers-jai_une_histoire_a_raconter/gallery-galerie-eng.aspx">near-contempt for taxis and taxi drivers</a>.</p>
<figure>
<iframe width="440" height="260" src="https://www.youtube.com/embed/hp-k7r8qcrY?wmode=transparent&start=0" frameborder="0" allowfullscreen=""></iframe>
<figcaption><span class="caption">Kam Phung summarizes the study in his Top 25 Finalists’ video in the Social Sciences and Humanities Research Council’s 2020 Storytellers challenge.</span></figcaption>
</figure>
<p>How were two groups of people doing the same work every day — driving other people to their desired destinations — being perceived so differently? As one Uber driver told us in an interview: “I don’t see the difference … there is no difference between each other.” But it seemed the media and Uber disagreed.</p>
<h2>Taxi driving as a stigmatized occupation</h2>
<p>Toronto is home to the largest taxi driver population in the country with more than 10,000 drivers, <a href="https://www.canada.ca/content/dam/ircc/migration/ircc/english/pdf/research-stats/taxi.pdf">over 80 per cent of them immigrants</a>. Unfortunately, <a href="https://doi.org/10.5465/ambpp.2014.182">taxi drivers</a> in Toronto have historically <a href="http://doi.org/10.1007/BF03403545">faced racism</a>, <a href="https://doi.org/10.1080/09502380903541605">classism</a> <a href="https://yorkspace.library.yorku.ca/xmlui/handle/10315/28278">and stigma</a>. More broadly, taxi driving has also been called “<a href="https://doi.org/10.5465/amr.1999.2202129">dirty work</a>.”</p>
<figure class="align-center ">
<img alt="A downtown Toronto intersection" src="https://images.theconversation.com/files/396920/original/file-20210424-23-xd022p.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&fit=clip" srcset="https://images.theconversation.com/files/396920/original/file-20210424-23-xd022p.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=600&h=400&fit=crop&dpr=1 600w, https://images.theconversation.com/files/396920/original/file-20210424-23-xd022p.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=600&h=400&fit=crop&dpr=2 1200w, https://images.theconversation.com/files/396920/original/file-20210424-23-xd022p.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=600&h=400&fit=crop&dpr=3 1800w, https://images.theconversation.com/files/396920/original/file-20210424-23-xd022p.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&h=503&fit=crop&dpr=1 754w, https://images.theconversation.com/files/396920/original/file-20210424-23-xd022p.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=754&h=503&fit=crop&dpr=2 1508w, https://images.theconversation.com/files/396920/original/file-20210424-23-xd022p.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=754&h=503&fit=crop&dpr=3 2262w" sizes="(min-width: 1466px) 754px, (max-width: 599px) 100vw, (min-width: 600px) 600px, 237px">
<figcaption>
<span class="caption">Intersection of Yonge St. and Queen St. W in downtown Toronto.</span>
<span class="attribution"><span class="source">(Kayla Speid/Unsplash)</span></span>
</figcaption>
</figure>
<p>The work of late Canadian-born sociologist <a href="https://www.britannica.com/biography/Erving-Goffman">Erving Goffman</a> and subsequent research have shown that <a href="https://doi.org/10.1287/orsc.1080.0368">stigma transfers</a> by association. This would suggest that Uber drivers would become stigmatized by virtue of entering the field of driving, just as taxi drivers are. But we didn’t see this happen for Uber drivers.</p>
<p>To make sense of this, we conducted an in-depth case study of Uber’s entry and expansion into Toronto from 2013 to 2016. We analyzed 976 media articles and conducted 55 interviews after walking the streets of Toronto and ordering Ubers to find real drivers.</p>
<p>We also conducted observations at protests, panel discussions and city hall meetings to better understand what was happening on the ground.</p>
<p>Based on this data, we wrote and published an open-access article in the <a href="https://doi.org/10.1111/joms.12574"><em>Journal of Management Studies</em></a>, where we argue that new entrants to a stigmatized occupation can actually deflect stigma. But how does this happen?</p>
<h2>Ambiguity and distinction</h2>
<p>Uber’s perceived categorical ambiguity — as seen in the surge of <a href="https://www.ctvnews.ca/business/uber-ride-share-taxi-or-tech-company-1.2044508">debates over how to label Uber and its drivers</a> — paved a path to differentiate Uber drivers from taxi drivers through two activities.</p>
<p>First, Uber spokespeople, public officials and media created a categorical distinction by <a href="https://www.cbc.ca/news/business/uber-taxi-app-takes-on-canadian-cab-companies-1.2662001">pointing to technology</a> to explain why “<a href="https://nationalpost.com/news/toronto/uber-is-not-a-taxi-company-judge-says-in-rejecting-city-of-toronto-complaint">Uber is not a taxi company</a>.”</p>
<p>Second, they highlighted differences between the perceived identities of Uber drivers and taxi drivers, often emphasizing that Uber drivers were driving short-term and part-time. Yet, this didn’t necessarily reflect reality. As one Uber driver told us in an interview:</p>
<blockquote>
<p>“I start at 7 a.m. and I finish at 7 p.m. Twelve hours. I try to work Monday to Friday because I have family and I have one daughter.… I want to enjoy the summer, but sometimes I work on Saturday at night.”</p>
</blockquote>
<h2>Worsening stigma for taxi drivers</h2>
<p>These categorical distinctions and perceived differences in identities helped Uber drivers deflect the stigma of taxi driving, despite many Uber drivers even acknowledging they did the same thing as their taxi counterparts.</p>
<p>Meanwhile, the stigma facing taxi drivers got worse. As distinctions and differences circulated in the media, they were accompanied by remarks anchored in prejudice tied to the social, moral and physical characteristics of taxi drivers. </p>
<p>These remarks <a href="https://www.theglobeandmail.com/globe-drive/adventure/red-line/how-uber-is-ending-the-dirty-dealings-behind-torontos-cab-business/article25515301/">degraded taxi drivers</a> to the <a href="https://www.thestar.com/news/gta/2016/02/04/fairness-for-cabbies-elusive-in-toronto.html">benefit of Uber drivers</a>, often emphasizing and juxtaposing the immigrant status, languages, hygiene and working conditions of taxi drivers compared to Uber drivers. Media coverage also often emphasized taxi industry features that were mandated and regulated by the city, and not taxi drivers themselves.</p>
<p>The media reported <a href="https://thewalrus.ca/uber-v-taxi/">on the convenience of the new Uber app</a> and its automatic credit card payment process, even though Uber was operating illegally — and as several taxi companies launched their own apps to “<a href="https://www.newswire.ca/news-releases/beck-taxi-launches-mobile-app-with-paypal-and-credit-card-in-app-payment-517735101.html">help riders commute hassle-free</a>.”</p>
<figure class="align-center ">
<img alt="A taxi is stopped on a downtown street" src="https://images.theconversation.com/files/396927/original/file-20210425-23-mp7x8m.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&fit=clip" srcset="https://images.theconversation.com/files/396927/original/file-20210425-23-mp7x8m.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=600&h=400&fit=crop&dpr=1 600w, https://images.theconversation.com/files/396927/original/file-20210425-23-mp7x8m.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=600&h=400&fit=crop&dpr=2 1200w, https://images.theconversation.com/files/396927/original/file-20210425-23-mp7x8m.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=600&h=400&fit=crop&dpr=3 1800w, https://images.theconversation.com/files/396927/original/file-20210425-23-mp7x8m.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&h=503&fit=crop&dpr=1 754w, https://images.theconversation.com/files/396927/original/file-20210425-23-mp7x8m.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=754&h=503&fit=crop&dpr=2 1508w, https://images.theconversation.com/files/396927/original/file-20210425-23-mp7x8m.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=754&h=503&fit=crop&dpr=3 2262w" sizes="(min-width: 1466px) 754px, (max-width: 599px) 100vw, (min-width: 600px) 600px, 237px">
<figcaption>
<span class="caption">Taxi stopped at Adelaide Street West in downtown Toronto.</span>
<span class="attribution"><span class="source">(Brad Killen/Unsplash)</span></span>
</figcaption>
</figure>
<p>By the time Uber was legalized as a “<a href="https://www.toronto.ca/services-payments/permits-licences-bylaws/private-transportation-companies-uberfacedrive-drivers/private-transportation-companies/">private transportation company</a>” and the distinctions between Uber drivers and taxi drivers <a href="https://www.toronto.ca/legdocs/municode/toronto-code-546.pdf">were formalized</a>, it wasn’t just that taxi drivers faced <a href="https://www.toronto.ca/wp-content/uploads/2019/06/97f5-Final-Economic-Impact-Study-Report.pdf">economic hardships</a>. They also argued there was a “<a href="https://toronto.ctvnews.ca/taxi-drivers-uber-executives-hold-heated-debate-over-industry-regulations-1.2565551">two-tier system</a>,” and Uber drivers and taxi drivers became polarized in the media.</p>
<p>One taxi driver told us:</p>
<blockquote>
<p>“It’s really severely marginalizing my existence.… I feel like I’m coming to the bitter end. I feel like that guy in the orange jumpsuit who is on his knees and a guy from ISIS is standing over me, except the guy in the black suit there is an Uber guy with a machete in his hand.” </p>
</blockquote>
<figure class="align-center ">
<img alt="A taxi driver gets out of his car, which has a Stop Uber sign in its window." src="https://images.theconversation.com/files/399221/original/file-20210506-23-1x8f9j3.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&fit=clip" srcset="https://images.theconversation.com/files/399221/original/file-20210506-23-1x8f9j3.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=600&h=419&fit=crop&dpr=1 600w, https://images.theconversation.com/files/399221/original/file-20210506-23-1x8f9j3.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=600&h=419&fit=crop&dpr=2 1200w, https://images.theconversation.com/files/399221/original/file-20210506-23-1x8f9j3.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=600&h=419&fit=crop&dpr=3 1800w, https://images.theconversation.com/files/399221/original/file-20210506-23-1x8f9j3.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&h=527&fit=crop&dpr=1 754w, https://images.theconversation.com/files/399221/original/file-20210506-23-1x8f9j3.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=754&h=527&fit=crop&dpr=2 1508w, https://images.theconversation.com/files/399221/original/file-20210506-23-1x8f9j3.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=754&h=527&fit=crop&dpr=3 2262w" sizes="(min-width: 1466px) 754px, (max-width: 599px) 100vw, (min-width: 600px) 600px, 237px">
<figcaption>
<span class="caption">A taxi driver protests Uber in Toronto in June 2015.</span>
<span class="attribution"><span class="source">THE CANADIAN PRESS/Nathan Denette</span></span>
</figcaption>
</figure>
<p>Uber’s entry into Toronto divided an occupation and exacerbated the social and economic hardships of taxi drivers. And it all started with how Uber and Uber drivers were categorized.</p>
<p>It’s encouraging that Uber drivers didn’t face the same stigma as taxi drivers. However, it’s disheartening that it avoided that fate at the cost of taxi drivers.</p><img src="https://counter.theconversation.com/content/158339/count.gif" alt="The Conversation" width="1" height="1" />
<p class="fine-print"><em><span>Kam Phung receives funding from the Social Sciences and Humanities Research Council of Canada. </span></em></p><p class="fine-print"><em><span>Madeline Toubiana received funding from Social Science and Humanity Research Council of Canada</span></em></p><p class="fine-print"><em><span>Trish Ruebottom receives funding from the Social Sciences and Humanities Research Council of Canada.. </span></em></p><p class="fine-print"><em><span>Luciana Turchick Hakak and Sean Buchanan do not work for, consult, own shares in or receive funding from any company or organisation that would benefit from this article, and have disclosed no relevant affiliations beyond their academic appointment.</span></em></p>Taxi drivers and Uber drivers perform the same work, but Uber’s categorization as a tech company has contributed to the historical stigma against taxi drivers.Kam Phung, PhD Candidate in Organization Studies, York University, CanadaLuciana Turchick Hakak, Assistant Professor, Organizational Behaviour, University of The Fraser ValleyMadeline Toubiana, Assistant Professor, Strategy, Entrepreneurship and Management, University of AlbertaSean Buchanan, Assistant Professor of Business Administration, University of ManitobaTrish Ruebottom, Associate Professor of HR and Management, McMaster UniversityLicensed as Creative Commons – attribution, no derivatives.tag:theconversation.com,2011:article/1195662019-07-04T10:58:23Z2019-07-04T10:58:23ZUber: ongoing battle for Buenos Aires is testing Argentina’s fragile democracy<figure><img src="https://images.theconversation.com/files/282514/original/file-20190703-126340-1wr2kr.jpg?ixlib=rb-1.1.0&rect=7%2C22%2C4913%2C3231&q=45&auto=format&w=496&fit=clip" /><figcaption><span class="caption">
</span> <span class="attribution"><a class="source" href="https://www.shutterstock.com/image-photo/buenos-aires-capital-city-argentina-556238962?src=5TZKdSkZF3EcUtOxIqvLXg-1-35&studio=1">Shutterstock.</a></span></figcaption></figure><p>Just 12 hours after Uber’s service became available in the Argentine capital, Buenos Aires, taxi industry representatives took the company – and the city’s administration – to court. The case was similar to those faced by the company in <a href="https://www.bbc.co.uk/news/business-44612837">London</a>, <a href="https://www.theguardian.com/world/2019/jan/31/uber-cabify-suspended-operations-barcelona">Barcelona</a>, <a href="https://www.theguardian.com/technology/2017/mar/28/uber-to-shut-down-denmark-operation-over-new-taxi-laws">Copenhagen</a>, <a href="https://uk.reuters.com/article/us-uber-hungary-exit/uber-to-suspend-operations-in-hungary-due-to-govt-legislation-idUKKCN0ZT0RS">Budapest</a>, <a href="https://www.reuters.com/article/us-uber-germany-ban/german-court-bans-ubers-unlicensed-taxi-services-idUSKBN0ME1L820150318">Frankfurt</a> and <a href="https://www.ft.com/content/3fee8054-575b-11e9-91f9-b6515a54c5b1">several US states</a> and <a href="https://www.cbc.ca/news/canada/toronto/ontario-uber-appeal-1.4963792">Canadian provinces</a>. Uber has faced legal challenges in relation to labour and licensing regulations, as well as allegations of <a href="https://www.cnbc.com/2019/03/22/uber-faces-fresh-legal-challenge-over-driver-data.html">misuse of data</a> and <a href="https://www.theguardian.com/technology/2019/jun/04/uber-tax-investigations-us-uk-netherlands-india">tax avoidance</a>. </p>
<p>Uber’s expansion has become a global epic with regional episodes. While the specifics differ, the terms of the debate remain the same. On one side: <a href="https://www.lanacion.com.ar/economia/una-alternativa-de-transporte-util-y-viable-nid1885396">the rhetoric</a> of inevitable technological progress and free choice. On the other: <a href="https://www.theguardian.com/commentisfree/2019/jun/02/gig-economy-us-trump-uber-california-robert-reich">claims that</a> precarious work and exploitation have reappeared in a sleeker guise. </p>
<p>Yet the Buenos Aires instalment of the saga is, in some ways, unique. In other places, Uber has acted on authorities’ demands – in some cases leaving those markets entirely, in others reforming or waiting for new regulations to develop. But on April 22, 2016, when <a href="https://ijudicial.gob.ar/wp-content/uploads/2016/04/cautelar-de-uber.pdf">a Buenos Aires judge declared</a> Uber’s activities to be in breach of local laws and ordered the immediate blockade of the app, Uber simply <a href="https://www.citylab.com/transportation/2019/05/buenos-aires-travel-guide-tips-uber-drivers-argentina-tax/589741/">continued its operations</a>. </p>
<p>Since then, protests by both Uber and taxi drivers <a href="https://www.citylab.com/transportation/2019/05/buenos-aires-travel-guide-tips-uber-drivers-argentina-tax/589741/">have intensified</a>, while the conflict has branched out on several legal fronts, dragging in <a href="https://www.perfil.com/noticias/sociedad/la-justicia-revoco-la-decision-que-ordenaba-el-bloqueo-de-las-plataformas-de-uber.phtml">more courts</a>, <a href="https://ijudicial.gob.ar/wp-content/uploads/2019/07/S.S.V-sobre-6147-Requisitos-de-los-veh%C3%ADculos-de-transporte-de-pasajeros.pdf">Uber drivers</a>, <a href="https://www.boletinoficial.gob.ar/detalleAviso/primera/206478/20190429">tax authorities</a>, <a href="https://www.clarin.com/ciudades/golpe-judicial-uber-condenan-empresa-ceo-organizar-actividades-ilegales-via-publica_0_YPhKJ_XEp.html">Uber officials themselves</a> and most recently one of the company’s Argentine lawyers, who initiated legal action in the state of California for what his legal representatives <a href="https://mcdonaldhopkins.com/Insights/News/2019/04/15/Suit-claims-Uber-reckless-entry-into-Buenos-Aires-had-devastating-impact-on-Argentine-lawyer">describe as</a> “the unimaginable harm Uber inflicted on him as a result of Uber’s recklessly orchestrated entry into Buenos Aires”. </p>
<p>Uber’s strategy might seem scandalous – perhaps even more so, because it’s working.</p>
<h2>Power to the people?</h2>
<p>From the beginning of the conflict, the ride-sharing company argued that <a href="https://www.youtube.com/watch?v=UkgWtW9oZaU">existing rules were obsolete</a>, and that it was willing to cooperate with authorities to develop a legal framework “<a href="https://www.youtube.com/watch?v=UkgWtW9oZaU">adapted to 21st century technology</a>”, so that people would be “<a href="https://www.lanacion.com.ar/economia/una-alternativa-de-transporte-util-y-viable-nid1885396">able to choose freely</a>” like millions of others around the world. </p>
<p>Among the middle classes of many developing nations like Argentina, these arguments and references to modernity have huge political significance.
In countries where democratic institutions are haunted by spectres of <a href="https://www.aljazeera.com/news/2019/05/argentina-president-christina-kirchner-faces-corruption-trial-190521131408914.html">corruption and bureaucratic mismanagement</a>, citizens see in Uber’s platform a world of opportunities. Anyone can set out and drive someone for money, a <a href="https://slate.com/news-and-politics/2018/10/uber-lyft-uberland-algorithms.html">completely impenetrable</a> algorithm produces market values according to demand, and users rate each other based on their experience. And crucially, no local actor can interfere: Uber’s separation from the state is seen to guarantee its virtues. </p>
<p>As part of <a href="https://www.socialsciences.manchester.ac.uk/social-anthropology/research/postgraduate-research/current-phd-students/juan-manuel-del-nido/">my PhD fieldwork</a> in Buenos Aires, I was researching how the middle classes understood the place of Argentina in the world. To these people, Uber carried the promise of a modernity beyond local interests and petty regulations. It seems the company has effectively aligned itself with the side of “the people”, in a struggle against governments, unions and other interests, which appear to stand in the way of progress. </p>
<h2>A test for democracy</h2>
<p>The legal tug-of-war resulting from Uber’s strategy is testing the strength of Argentina’s governance structures. Cities and states seeking to enforce the rule of law can appear silly and provincial in the eyes of their citizens – even when similar laws are followed elsewhere. Buenos Aires’ minister of transportation characterised Uber’s business strategy as being “<a href="https://www.lanacion.com.ar/lifestyle/mendez-cuando-me-reunia-con-uber-parecia-que-estaba-negociando-con-las-farc-nid2138985">two-tiered</a>”: respecting governments in developed countries, ignoring them in developing ones. </p>
<p>Uber’s regional director for Latin America <a href="https://www.lanacion.com.ar/lifestyle/mendez-cuando-me-reunia-con-uber-parecia-que-estaba-negociando-con-las-farc-nid2138985">George Gordon replied</a>: </p>
<blockquote>
<p>French president Emmanuel Macron received Dara Khosrowshahi, Uber’s CEO, and they jointly announced investments in new forms of transportation and the launching of an insurance policy bringing maternity and paternity benefits to drivers and accident and injury coverage. This is an example of the relations we want to build in each country and city where we operate. Uber will continue to operate in Argentina, committed to growing and in the hope of opening a space of dialogue and cooperation with national authorities.</p>
</blockquote>
<p>The irony is that the modernity middle class people in developing countries yearn for cannot exist without government and the rule of law. The structures and policies of private companies are set up for profit, not for public interest. The point of the law is precisely to ensure there is a framework citizens can reach out for, when things go wrong. </p>
<p>If the driver of a ride-sharing platform commits a crime, would a low rating be sufficient sanction? Would it be for that platform’s management to decide what counts as evidence? Those opposing Uber asked such questions hundreds of times, but amid the race for modernity they have seemed to be somehow missing the point. </p>
<p>Uber’s legal conflict in Buenos Aires may be entering its fourth year, but the people have already decided their winner. A developing nation’s yearning for modernity proved the crucial battleground for a slightly different epic than usual. At the very least, this ongoing saga should prompt new debates about new technologies and their place in people’s lives.</p><img src="https://counter.theconversation.com/content/119566/count.gif" alt="The Conversation" width="1" height="1" />
<p class="fine-print"><em><span>Juan Manuel del Nido does not work for, consult, own shares in or receive funding from any company or organisation that would benefit from this article, and has disclosed no relevant affiliations beyond their academic appointment.</span></em></p>Uber’s expansion has become a global epic with regional episodes, but the legal conflict in Argentina has even higher stakes.Juan Manuel del Nido, Postdoctoral Researcher, University of ManchesterLicensed as Creative Commons – attribution, no derivatives.tag:theconversation.com,2011:article/879982017-11-24T05:13:42Z2017-11-24T05:13:42ZUber was hacked, so change your password right now. Here’s what else you need to know<p>Uber has admitted that a 2016 <a href="https://www.uber.com/newsroom/2016-data-incident/">data breach</a> put at risk the personal information of 57 million Uber users worldwide and at least 600,000 drivers in the United States.</p>
<p>The ride-share firm’s CEO <a href="https://www.uber.com/newsroom/2016-data-incident/">said</a> that: </p>
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<p>two individuals outside the company had inappropriately accessed user data stored on a third-party cloud-based service that we use.</p>
</blockquote>
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Read more:
<a href="https://theconversation.com/will-australians-ever-give-up-uber-79754">Will Australians ever give up Uber?</a>
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<p>Now it has <a href="http://www.afr.com/technology/uber-confirms-australians-caught-in-hack-20171122-gzr61i">been reported</a> that Australian riders and drivers are part of the data breach.</p>
<p>It would be prudent for Australian Uber users and drivers to change their passwords as soon as possible. Here’s what else you need to know:</p>
<h2>If you use Uber, your name, email address and mobile phone number may have been leaked</h2>
<p>Uber <a href="https://help.uber.com/h/12c1e9d1-4042-4231-a3ec-3605779b8815">says</a>:</p>
<blockquote>
<p>Rider information [put at risk in this data breach] included the names, email addresses and mobile phone numbers related to accounts globally. Our outside forensics experts have not seen any indication that trip location history, credit card numbers, bank account numbers, Social Security numbers or dates of birth were downloaded.</p>
</blockquote>
<p>Breaches of this kind can mean an increase in people receiving spam email. Some experts have <a href="http://www.huffingtonpost.co.uk/entry/uber-hack-what-does-the-data-breach-mean-if-ive-been-hacked-and-should-i-be-worried_uk_5a154b7ce4b025f8e9327fa4">said</a> that any personal information could be worth something to criminals.</p>
<h2>What evidence is there that the hack included data from Australian users of Uber?</h2>
<p>The public disclosures Uber has made so far make it very difficult to identify Australians caught up in the data breach. That’s because the firm was not very transparent about it.</p>
<p>Media reports that Uber worked hard to <a href="https://www.bloomberg.com/news/articles/2017-11-21/uber-concealed-cyberattack-that-exposed-57-million-people-s-data">conceal the data breach</a> suggest Uber’s corporate governance needs improvement.</p>
<p>In its recent <a href="https://www.uber.com/newsroom/2016-data-incident/">statement</a> on the data breach, Uber CEO Dara Khosrowshahi acknowledged the firm’s “failure to notify affected individuals or regulators last year” and promised to do better.</p>
<h2>I’m an Uber driver. What do I need to know?</h2>
<p>Uber has <a href="https://help.uber.com/h/0ded7de4-ed4d-4c75-a3ee-00cddeafc372">said</a>:</p>
<blockquote>
<p>Driver information included the names, email addresses and mobile phone numbers related to accounts globally. In addition, the driver’s license numbers of around 600,000 drivers in the United States were downloaded.</p>
</blockquote>
<p>As with the message to riders, Uber says it has seen no indication that trip location history, credit card numbers, bank account numbers, Social Security numbers, or dates of birth were downloaded.</p>
<p>The firm says that it is directly notifying affected drivers by mail or email, and is offering them free credit monitoring and identity theft protection – but, in any case, it’s a good idea for any Uber driver to change their password.</p>
<p>The longer-term issue is that news of the hack might conceivably dissuade some people from using Uber at all, which would be bad news for drivers.</p>
<p>So a fundamental part of Uber’s crisis management strategy should be educating drivers on how to respond to consumer questions about data privacy. This will not only assure the drivers but also help rebuild the trust of customers.</p>
<p>That said, it is pre-Christmas party time in cities throughout the world, and that means boom time for the Uber, taxi and personal transport industries. </p>
<p>So it’s easy to imagine there would be only a small impact on Uber drivers over this period.</p>
<h2>What’s the cost of online convenience?</h2>
<p>Uber is not the first and won’t be the last to be involved in a data breach. As transactions are increasingly made over the internet, it is highly likely Australians will fall victim to more and more data hacks.</p>
<hr>
<p>
<em>
<strong>
Read more:
<a href="https://theconversation.com/sorry-everyone-on-the-internet-youre-always-the-product-77235">Sorry everyone: on the internet, you're always the product</a>
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</em>
</p>
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<p>Consumers who may be left out-of-pocket, receiving increased spam email and risking other privacy breaches such as identity theft may be less than loyal to firms that don’t look after their data.</p>
<p>Moreover, as there is <a href="https://insidesmallbusiness.com.au/planning-management/what-do-hackers-do-with-your-stolen-data">money and influence to be gained</a> through online data crime, it is highly likely that criminals will become better organised to reap the incentives in a very strategic manner.</p>
<p>It’s worth remembering that, in many cases, the <a href="https://theconversation.com/sorry-everyone-on-the-internet-youre-always-the-product-77235">cost of convenience</a> for using a service over the internet is your private information. </p>
<p>Many <a href="https://www.forbes.com/sites/firewall/2010/04/08/who-reads-the-fine-print-online-less-than-one-person-in-1000/">people</a> do <a href="https://www.theguardian.com/commentisfree/2014/apr/24/terms-and-conditions-online-small-print-information">not</a> <a href="https://www.npr.org/2016/08/23/491024846/do-you-read-terms-of-service-contracts-not-many-do-research-shows">read the terms and conditions</a> they agreed to for internet transactions, and they may shocked by the level of exposure they face. </p>
<p>Consumers <a href="https://theconversation.com/you-may-be-sick-of-worrying-about-online-privacy-but-surveillance-apathy-is-also-a-problem-86474">accept financial and privacy risk</a> by trading over the internet, all for the sake of cheap tickets, discount car rides and other conveniences.</p>
<p>As these breaches happen more often, it may be impossible to totally avoid one’s exposure to internet-based transactions and online data storage. So there will likely be increasing pressure on politicians and regulators to add some real teeth to prosecutions (although many seem to be based in difficult-to-prosecute jurisdictions).</p>
<p>The Australian government’s <a href="https://www.oaic.gov.au/engage-with-us/consultations/notifiable-data-breaches/">notifiable data breach scheme</a> will start on February 22, 2018. It only applies to eligible data breaches that occur on, or after, that date.</p>
<hr>
<p>
<em>
<strong>
Read more:
<a href="https://theconversation.com/you-may-be-sick-of-worrying-about-online-privacy-but-surveillance-apathy-is-also-a-problem-86474">You may be sick of worrying about online privacy, but 'surveillance apathy' is also a problem</a>
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</p>
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<h2>How can Uber prevent this from happening again?</h2>
<p>In the short term, Uber says it has “implemented security measures to restrict access to and strengthen controls on our cloud-based storage accounts”.</p>
<p>The longer-term problem is changing the attitudes that led to the data breach being concealed for so long.</p>
<p>When Dara Khosrowshahi took over as Uber’s CEO last August, hopes were high that he would soften some aspects of the extreme-performance culture that led to earlier ethical lapses in Uber.</p>
<p>There may be a perception among consumers that the firm’s desire to keep secret its intellectual property relating to algorithms has spread to its broader operations. </p>
<p>A good start for Uber would be to increase its public reporting on its operations. A widely publicised code of ethics, whistleblowing protections and ethics training for all staff would certainly not go amiss.</p><img src="https://counter.theconversation.com/content/87998/count.gif" alt="The Conversation" width="1" height="1" />
<p class="fine-print"><em><span>The authors do not work for, consult, own shares in or receive funding from any company or organisation that would benefit from this article, and have disclosed no relevant affiliations beyond their academic appointment.</span></em></p>Uber has admitted that the 2016 data breach puts at risk the personal information of 57 million users.Rohan Miller, Senior Lecturer, Marketing and Digital Business, University of SydneyDavid Oliver, Senior Lecturer in Management, University of SydneyLicensed as Creative Commons – attribution, no derivatives.tag:theconversation.com,2011:article/684622017-01-06T01:15:31Z2017-01-06T01:15:31ZHow ride-hailing apps like Uber continue cab industry’s history of racial discrimination<p>From hailing taxis that won’t stop for them to being forced to ride at the back of buses, African-Americans have long endured discrimination within the transportation industry. </p>
<p>Many have hoped the emergence of a technology-driven “new economy,” providing greater information and transparency and buoyed by an avowed idealism, would help us break from our history of systemic discrimination against minorities. </p>
<p>Unfortunately, our research shows that the new economy has brought along some old baggage, suggesting that it takes more than just new technologies to transform attitudes and behavior.</p>
<p>Our new paper, “<a href="http://www.nber.org/papers/w22776">Racial and Gender Discrimination in Transportation Network Companies</a>,” found patterns of discrimination in how some drivers using ride-hailing platforms, such as Uber and Lyft, treat African-American passengers and women. Our results are based on extensive field studies in Seattle and Boston, both considered liberal-minded cities, and provide stark evidence of discrimination.</p>
<h2>Taxis and discrimination</h2>
<p><a href="http://www.bbc.com/news/world-australia-34674173">Discrimination</a> by <a href="http://nypost.com/2015/05/28/puerto-rico-mayor-booted-from-nyc-cab/">taxi drivers</a> has long been a <a href="http://www.theatlantic.com/politics/archive/2015/10/why-i-still-get-shunned-by-taxi-drivers/411583/">social problem</a>. As a result, most cities explicitly require drivers to pick up any passenger while on duty, something <a href="http://nypost.com/2015/06/09/city-puts-biased-taxi-drivers-on-notice/">they’re reminded of</a>, but such provisions are difficult to enforce. Our work confirmed that traditional taxis in downtown Seattle were more likely to pass black passengers without stopping than to drive by white passengers.</p>
<p>Advances in technology are drastically changing the cab-hailing experience, however, allowing those in need of a lift to order a car with a few taps on a smartphone. The question we wanted to answer with our research is whether this fast-growing market is treating customers of all races and genders equally. </p>
<p>Plainly put, is the traditional taxi driver’s decision, made in public view, not to stop for an African-American passenger being eliminated? Or is it just being replaced by a driver’s swipe on a screen, made in private but with the same effect?</p>
<p>The relationship between these services and discrimination is a complex one. A <a href="http://botecanalysis.com/wp-content/uploads/2015/07/LATS-Final-Report.pdf">study funded by Uber</a> found that its UberX service provided lower fares and shorter wait times than traditional taxis in areas of Los Angeles with below-average incomes. <a href="http://www.sciencedirect.com/science/article/pii/S0966692316301430">Similar research found</a> that expected wait times for the service were shorter in Seattle-area neighborhoods with lower incomes, even after adjusting for several variables. On the other hand, ride-hailing apps are unavailable to customers without a credit card, <a href="http://www.cnbc.com/2015/05/05/credit-invisible-26-million-have-no-credit-score.html">who are more likely to be</a> lower-income and a member of a minority group.</p>
<p>But this looks at the problem only from a systemic point of view, while the actual decision to pick up a passenger is made by individual drivers. Although drivers are required to maintain high levels of overall performance, there is no mechanism that might detect whether they’re discriminating. </p>
<p>For our study, we used a simple but powerful method to measure this: random field tests. We dispatched research assistants – white and black, male and female – into the field, at varying times of the day and in varying parts of Seattle and Boston, and asked them to order, wait and ride in vehicles hailed by a platform like Uber, which we term “transportation network companies,” or TNCs. </p>
<p>Such random field tests are conceptually simple, but they’re considered the “gold standard” in the research field – and we conducted nearly 1,500 rides in the two cities.</p>
<p>At all times, the research assistants carefully monitored and recorded predetermined performance metrics for every ride they took with screenshots of their smartphones: before requesting a trip (with expected wait time), just after the trip is accepted (with a new wait time), again if a driver canceled, when the driver arrives and when the vehicle stops at the destination. Using the data gathered, we evaluated wait times, travel times, cancellation rates, costs and ratings awarded. </p>
<p>OK, what did we find?</p>
<h2>The good news</h2>
<p>First of all, there is some good news. </p>
<p>For one, black passengers in our study received the same level of “star ratings” from drivers that picked them up as white ones, meaning that their future trip requests will not be handicapped by poor reviews. </p>
<p>Second, as we noted earlier, <a href="http://faculty.washington.edu/dwhm/2016/10/24/does-uber-equitably-serve-different-types-of-neighborhoods/">other recent research has shown</a> that (at least in Seattle) predicted waiting times for an Uber are actually shorter in lower-income neighborhoods than in wealthier areas, suggesting that drivers are not avoiding low-income areas altogether. </p>
<h2>The bad news</h2>
<p>Unfortunately, there is some bad news, too. In short, we found significant discrimination in both cities. </p>
<p>In Seattle, the data showed African-American passengers had to wait consistently longer to get picked up by an Uber – as much as 35 percent more than white passengers. The data also showed that black passengers waiting slightly longer than white passengers to have Lyft requests accepted, although this did not translate into a significantly longer wait to be picked up.</p>
<p>In Boston, a separate experiment that captured a wider variety of performance metrics found more frequent cancellations when a passenger used stereotypically African-American-sounding names such as Jamal or Aisha. Across all trips, the cancellation rate for black-sounding names was more than double that for stereotypically white-sounding names such as Jerry or Allison. </p>
<p>The effect was even stronger in low-density (more suburban) areas, where male passengers were more than three times as likely to have their trips canceled when they used an African-American-sounding name as when they used a white-sounding name. We also found evidence that in at least some cases, drivers took female passengers for longer – and potentially more expensive – rides. </p>
<p>We emphasize that we are not saying TNCs are better or worse than traditional taxis. In fact, our data do not allow us to make that comparison. Anecdotally, many travelers report that they can now get a ride whereas in the past they could not. But what our data do show is that differences in quality of service seem to persist. </p>
<h2>Is there a solution?</h2>
<p>We believe that many of the problems we have identified can be mitigated simply by changing some of the practices and policies at ride-sharing companies. Uber <a href="https://news.ycombinator.com/item?id=12354407">has already begun adopting</a> one change – flat fares based on origin and destination – that could reduce the incentive for drivers to take passengers on longer routes. </p>
<p>Transportation network companies may also want to increase the direct penalties for drivers who cancel trips, including cases where they don’t officially cancel but simply never pick up the passenger – another behavior we observed. Implementing periodic or ongoing audits to detect potentially discriminatory behavior may help as well.</p>
<p>And more data are needed. We are sure that much more could be learned from data that are locked away inside the companies. But the companies – understandably – are reluctant to share it except when compelled to do so by regulators. </p>
<h2>End of discrimination?</h2>
<p>Could these and other changes eliminate racial and gender discrimination within the emerging ride-hailing industry? </p>
<p>Unfortunately, complete elimination is unlikely. And care should be taken to ensure that well-intentioned measures don’t simply shift the locus of discrimination. For example, making it harder for drivers to cancel might have the unintended consequence of causing drivers to give certain types of riders lower star ratings or avoid certain neighborhoods altogether, which could actually worsen the impact of discrimination.</p>
<p>We are confident that Uber, Lyft and other TNCs have the technological know-how to continue revolutionizing urban transportation. They also now have the evidence that they can and should make changes to their policies and practices to ensure that everyone shares in the benefits of our new economy.</p><img src="https://counter.theconversation.com/content/68462/count.gif" alt="The Conversation" width="1" height="1" />
<p class="fine-print"><em><span>Don MacKenzie received funding for the work discussed here from the University of Washington's Royalty Research Fund. He has received other funding from the National Science Foundation, Toyota Motor North America, Seattle Department of Transportation, Washington State Department of Transportation, and the US Department of Transportation via the Pacific Northwest Transportation Consortium. He has received in-kind contributions from Lyft and BMW (passenger credits for research participants) in support of an unrelated project.</span></em></p><p class="fine-print"><em><span>Christopher R. Knittel, Stephen Zoepf, and Yanbo Ge do not work for, consult, own shares in or receive funding from any company or organization that would benefit from this article, and have disclosed no relevant affiliations beyond their academic appointment.</span></em></p>Cab drivers have long discriminated against African-Americans and other minority groups. New research suggests ride-hailing apps haven’t solved the problem.Yanbo Ge, Ph.D. in Civil & Environmental Engineering, University of WashingtonChristopher R. Knittel, Professor of Applied Economics and Director of the Center for Energy and Environmental Policy Research, MIT Sloan School of ManagementDon MacKenzie, Assistant Professor of Civil and Environmental Engineering, University of WashingtonStephen Zoepf, Executive Director of the Center for Automotive Research, Stanford UniversityLicensed as Creative Commons – attribution, no derivatives.tag:theconversation.com,2011:article/596772016-05-19T19:36:58Z2016-05-19T19:36:58ZSacked Uber driver case shows driver vulnerability under law<p>Perth Uber driver, Mike Oze-Igiehon, is suing Uber in the District Court for damages after it terminated his contract. The outcome of this case may shed some light on status of drivers in the eyes of the law.</p>
<p>The main issue is whether or not uber drivers are classified as employees and therefore entitled to the usual Fair Work protections or whether they are independent contractors, able to access rights to unfair contracts review <a href="http://www5.austlii.edu.au/au/legis/cth/consol_act/ica2006255/s12.html">by the Federal Court</a></p>
<p>If the <a href="http://www.smh.com.au/business/the-economy/driver-sues-uber-for-deactivating-account-20160517-gowsd5.html">newspaper reports are accurate</a>, Mr Igiehon has been advised to bring a contract claim in the District Court. He will need to argue that Uber breached its contract with him and that this caused his loss. </p>
<p>The news reports allege that Uber “blocked” him because of bad reviews from customers, so Uber is claiming that it had a right to terminate the contract with no notice. If the terms of the contract say that Uber can terminate only with reasons, Uber will have to prove it had a sufficiently serious reason to warrant terminating the contract. </p>
<p>If Mr Oze-Igiehon can show that Uber had no right to terminate, the District Court could award him damages for what he has lost as a consequence of this wrongful termination, including some of the costs of his car loan. Until the court has heard the case, it is impossible to assess the likelihood of success, but one thing is clear, this avenue for redress of shabby treatment is expensive and risky for the worker. </p>
<p>The trouble with contract law is it favours the person who decided what terms to put into the contract. It is unlikely in the extreme that the Uber drivers have negotiated fair terms for themselves. </p>
<p>What if Mr Oze-Igiehon had decided instead to rely on the <a href="http://www.austlii.edu.au/au/legis/cth/consol_act/ica2006255/">Independent Contractors Act 2006</a>? He may have persuaded the Federal Court to vary his contract if it did include a term allowing Uber to terminate the contract immediately, without warning or a chance to explain, when they knew he had a large debt to service his vehicle loan. </p>
<p>This happened in litigation <a href="http://www.austlii.edu.au/cgi-bin/sinodisp/au/cases/cth/FMCA/2010/394.html?stem=0&synonyms=0&query=Keldote">between Riteway Transport and some of its drivers</a>. The benefit of unfair contracts review is that exploitative contracts can be rewritten, but cases still need to be litigated at some expense and delay before a federal court. </p>
<p>If Mr Oze-Igiehon were an employee of Uber, he could bring an unfair dismissal claim, but only if he had been driving for the minimum qualifying period (of six months, since Uber is not classified as a small business). Uber would need to show that it had a valid reason for dismissing him, and that they followed fair procedures in investigating the complaints. </p>
<p>The unfair dismissal system is quick (applicants must file a complaint within 21 days), and relatively cheap. The Fair Work Commission (FWC) first attempts to resolve the complaint by a telephone mediation. </p>
<p>However only employees can go to the FWC. It is a live issue whether Uber drivers in Australia could establish that they are employees, and whether they would even want to try. </p>
<p>We apply a multi-factor test in Australia to decide whether a worker is an employee or not. Organisations like Uber are generally very careful to set up their arrangements so that their work contracts avoid characterisation as employment. They seek to avoid any conclusion that they control the worker, by leaving it up to the worker whether to accept any work or not. </p>
<p>Requiring the worker to meet all of the substantial costs of providing the vehicle is – ironically – a factor that tends towards a finding that the worker is not an employee. Taxi drivers are not considered to be employees in Australia either. They are typically treated as “bailees” – people who have taken possession of a vehicle for the purpose of earning income. </p>
<p>An alternative approach to trying to squeeze digital economy work contracts into the mould of the employment contract, would be to regulate specifically for this kind of contract. Just as there is specific regulation for taxi drivers. </p>
<p>Regulation to ensure minimum rates of pay, and protection from capricious termination of their contracts would go some way to ensuring that these workers are not exploited.</p><img src="https://counter.theconversation.com/content/59677/count.gif" alt="The Conversation" width="1" height="1" />
<p class="fine-print"><em><span>Joellen Riley Munton does not work for, consult, own shares in or receive funding from any company or organisation that would benefit from this article, and has disclosed no relevant affiliations beyond their academic appointment.</span></em></p>A case of an uber driver from Perth suing the company because his contract was terminated may show how protected drivers are under law.Joellen Riley Munton, Dean and Professor of Labour Law, University of SydneyLicensed as Creative Commons – attribution, no derivatives.tag:theconversation.com,2011:article/488202015-10-19T05:55:16Z2015-10-19T05:55:16ZWhen Uber is legal the taxi industry will have nowhere to hide<p>In the latest instalment of Uber versus the taxi industry, the Taxi Industry Forum of WA has conceded the sector could have done better. Responding to a Western Australian Government <a href="http://www.transport.wa.gov.au/taxis/on-demand-transport-green-paper.asp">green paper</a> into the “on demand” transport industry, it has <a href="http://www.abc.net.au/news/2015-10-16/wa-taxi-industry-slams-uber/6862222">reportedly</a> criticised the UberX model, but also admitted its own failure to keep up with technological advances and changing consumer expectations.</p>
<p>Digital disrupters such as Uber have been <a href="https://ipa.org.au/publications/2430/the-sharing-economy">praised</a> by industry commentators for promoting a sharing economy that challenges established oligopolistic transport providers and bypasses government regulation.</p>
<p>So there was some irony in last month’s <a href="http://www.cmd.act.gov.au/open_government/inform/act_government_media_releases/barr/2015/ridesharing-to-improve-transport-in-canberra">announcement</a> from the ACT Government, home of bureaucratic regulatory activity, that it will pass laws to make Uber “legal”. </p>
<p>The proposal has been condemned by taxi providers, who have consistently <a href="http://www.bbc.com/news/uk-england-london-34549700">used established law</a> to try and shut down ride-sharing options, both in Australia and overseas. Conversely Uber has praised the move as enlightened recognition of the opportunities offered by new technologies. </p>
<p>For consumers, placing taxis and Uber on a more level playing field should promote competition, reduce costs and buttress safety. </p>
<h2>Still not a taxi service</h2>
<p>In legal terms, Uber <a href="http://www.abc.net.au/news/2015-10-16/does-uber-need-the-laws-to-change-fact-check/6846512">operates along the lines of a hire car business</a> rather than a taxi service. This will not change under the <a href="http://www.cmd.act.gov.au/__data/assets/pdf_file/0012/778575/150929_ACT-TaxiIndustryReforms_Drivers.pdf">new ACT law</a>. Uber will not be able to pick passengers up from taxi ranks or be hailed on the street. </p>
<p>Reduced licence fees should mean cheaper prices for consumers. The bar to Uber operating “legally” as a hire car business in most states and territories is the high cost of a licence (A$40,000 in Victoria) and/or the requirement that a hire car be a luxury vehicle. These requirements are of course an anathema to UberX, which is premised on ordinary people sharing rides in ordinary cars. </p>
<p>Under the proposed ACT laws, licencing fees for taxis and hire cars will be reduced, while some new, fairly minimal fees will be imposed on ride sharing operators to cover licensing and accreditation</p>
<p>For established services these reductions are significant. Taxi vehicles in the ACT currently pay a A$20,000 licence fee. Under the proposed reforms this fee will be reduced to A$5,000 in 2016 in the ACT. The licence fee for ride share drivers will be A$100 or A$400 for five years.</p>
<p>Given there will be a degree of competition in the market, one would expect this reduction in licence fees to be passed onto consumers on the form of lower prices for taxis and hire cars, as well as more opportunities for ride sharing. In addition, the proposed reforms aim to allow both taxi and ride share drivers to access more than one online “transport booking service” potentially further increasing flexibility and competition.</p>
<h2>Safety improved</h2>
<p>The proposed ACT reforms will impose basic safety and consumer protection standards including requirements for:</p>
<ul>
<li>police and driver history checks</li>
<li>up-front medical assessments of drivers</li>
<li>drivers to have a zero blood alcohol level and be drug-free </li>
<li>minimum training requirements for drivers </li>
<li>rideshare vehicles to be registered and roadworthy </li>
<li>vehicles used for rideshare to receive an accredited annual inspection </li>
<li>specific compulsory third-party and property insurance </li>
<li>handling of private information about passengers, including bank and transaction information, to comply with relevant Commonwealth and ACT privacy legislation </li>
</ul>
<p>In addition, under the proposed new laws, transport booking services (such as UberX) must have customer complaint mechanisms in place and drivers should be aware of the process. </p>
<p>A recent <a href="https://www.choice.com.au/transport/cars/general/articles/uberx-vs-taxi-which-one-is-best">Choice comparison</a> found the UberX service was as safe as that offered by taxis. This was because UberX utilises GPS tracking of all trips and because Uber already requires its drivers to undergo a police check, have a clean driving record and hold third party and third party property insurance, as well as providing insurance coverage itself for all UberX trips.</p>
<p>While some might accordingly see the measures proposed by the ACT Government as regulatory overkill stifling a new industry, realistically it can only bring consumers comfort. Safety is likely to be high on the list of priorities of most taxi, hire car and ride sharing users. </p>
<p>Consumers are unlikely to be able to investigate the driving record of their booked driver or the safety of the vehicle before they set out on a ride. Making safety measures mandatory entrenches the measures already in place by Uber to the benefit of consumers. To the extent Uber already undertakes these types of measures, the new laws should not increase costs significantly. The mandatory nature of the requirements will also prevent new ride share entrants trying to undercut Uber by skimping on safety. </p>
<h2>Other states?</h2>
<p>It’s hard to predict whether these moves to make Uber legal will be followed in other Australian states. But it appears consumers see UberX as offering a <a href="http://www.abc.net.au/news/2015-10-16/wa-taxi-industry-slams-uber/6862222">fresh alternative</a> to the unresponsive and outmoded customer service of the taxi industry. So consumer demand may well prompt reform, through further regulation, of the sector in other jurisdictions before too long.</p><img src="https://counter.theconversation.com/content/48820/count.gif" alt="The Conversation" width="1" height="1" />
<p class="fine-print"><em><span>Jeannie Marie Paterson receives funding from the Australian Research Council.</span></em></p>Whatever happens to Uber’s legal status in Australia, it’s likely consumers will be the eventual winners.Jeannie Marie Paterson, Associate Professor, The University of MelbourneLicensed as Creative Commons – attribution, no derivatives.tag:theconversation.com,2011:article/458782015-08-12T04:16:31Z2015-08-12T04:16:31ZFactCheck: are ridesharing services like Uber no safer than hitchhiking?<blockquote>
<p>Ridesharing. It’s no safer than hitchhiking. – full page <a href="http://resources1.news.com.au/images/2015/08/09/1227476/478929-e72c61f0-3e29-11e5-b3df-81490740049a.jpg">advertisement</a> by the NSW Taxi Council.</p>
<p>Allowing illegal taxi services to operate unregulated puts the public at significant risk. – NSW Taxi Council CEO Roy Wakelin-King, <a href="http://www.dailytelegraph.com.au/subscribe/news/1/index.html?sourceCode=DTWEB_WRE170_a&mode=premium&dest=http://www.dailytelegraph.com.au/news/nsw/uber-cabbies-heat-up-the-ridesharing-battle-with-new-series-of-damning-ads/story-fni0cx12-1227476480344&memtype=registered">interview</a>, The Daily Telegraph, August 10, 2015.</p>
</blockquote>
<p>In Australia, as in other countries, Uber and ridesharing apps like it are now posing a threat to the market dominance of traditional options such as taxis.</p>
<p>The threat to livelihood is taken so seriously that taxi drivers recently <a href="http://www.theverge.com/2015/6/25/8844649/french-taxi-driver-protest-uber-pop-paris">rioted in France</a> with the aim of stopping Uber providers and users and eroding their trade. But traditional commercial transport groups have launched other, more subtle, attacks aimed at making people think twice before using these types of apps. </p>
<p>One such tactic is to claim ridesharing carries an <a href="http://www.brisbanetimes.com.au/queensland/uber-potential-sexual-haven-for-predators--taxi-council-20150727-gildms.html">increased risk of crime</a> when compared to traditional transport methods. In other words: scare tactics.</p>
<h2>The NSW Taxi Council’s evidence</h2>
<p>When asked for data to support the claim that ridesharing is no safer than hitchhiking, a NSW Taxi Council spokesman said:</p>
<blockquote>
<p>Illegal ridesharing is provided by private drivers in private vehicles. The services are provided outside of the law and therefore none of the safety systems that are mandated for taxis exist in illegal ridesharing vehicles and ridesharing drivers.</p>
<p>Specifically, illegal ridesharing vehicles do not have:</p>
<ul>
<li>Security cameras as mandated by the NSW Government</li>
<li>Alarm systems as required by the NSW Government</li>
<li>Vehicle tracking devices that are fixed to the vehicle</li>
<li>Distinctive livery and internationally recognised signage to identify the vehicle</li>
<li>Compulsory independent vehicle checks on a regular basis at a Government authorised inspection station</li>
<li>Roadside compliance operations which in the last 12 months have checked over 2000 vehicles</li>
</ul>
<p>In addition to the above, illegal ridesharing drivers are not required by law to:</p>
<ul>
<li>Undergo criminal background checks</li>
<li>Driver history checks</li>
<li>Medical checks to a national standard</li>
<li>Immigration checks</li>
<li>National based training and competency standards</li>
<li>Independent knowledge and English language testing</li>
</ul>
<p>For taxis, all of these checks occur upon application and they are ongoing. Taxi drivers who fails to continuously meet these obligations can lose their authority to drive. It is clear that illegal ridesharing, in the absence of the government requirements above, is no safer than hitchhiking. There have been numerous examples both overseas and now emerging in Australia where passengers of illegal taxi services like ridesharing are being exposed to significant risk.</p>
</blockquote>
<p>The spokesman referred The Conversation to <a href="http://www.wfaa.com/story/news/crime/2015/08/08/uber-admits-mistakes-apologizes--sex-assault-victim/31328465/">several</a> <a href="http://www.businessinsider.com.au/r-indian-woman-alleges-rape-by-uber-cab-driver-in-new-delhi-2014-12">recent</a> <a href="http://www.latimes.com/local/lanow/la-me-ln-uber-criminal-records-20150804-story.html">examples</a> <a href="http://www.thelocal.se/20150707/uber-sweden-in-hot-water-over-driver-checks">of</a> <a href="http://www.nswtaxi.org.au/sites/default/files/Triple%20J%20hack_wed_2015_5_6.mp3">risk</a> to <a href="http://www.theguardian.com/technology/2015/mar/23/united-nations-uber-womens-safety">passengers</a>.</p>
<p>In both the <a href="http://www.mirror.co.uk/tv/tv-news/whos-driving-you-chilling-uber-6204293">UK</a> and the <a href="http://www.latimes.com/local/lanow/la-me-ln-uber-criminal-records-20150804-story.html">US</a>, criminals convicted of sexual and violent crimes have successfully passed Uber background checks. All criminal background checks of Uber drivers are conducted via the Australian Federal Police’s <a href="http://www.crimtrac.gov.au">Crimtrac</a> database, while driving history checks are conducted by the relevant transport authority in each state. </p>
<p>A factsheet provided to The Conversation by Uber says: </p>
<blockquote>
<p>When a rider books a ride through the app they are provided with the name, photograph and vehicle plate number of the driver-partner and can track their route on a map. A rider can also share the details of their trip with others through the Share My ETA feature.</p>
</blockquote>
<p>Uber also riders and drivers to rate each other out of five stars after each trip and to submit written feedback.</p>
<p>The Routine Activity Theory or “crime triangle” theory provides a relatively simple explanation as to why most crimes occur. The theory argues that a crime is more likely to occur when there is a lack of capable guardianship.</p>
<figure class="align-center zoomable">
<a href="https://images.theconversation.com/files/91265/original/image-20150810-11068-1efexp6.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=1000&fit=clip"><img alt="" src="https://images.theconversation.com/files/91265/original/image-20150810-11068-1efexp6.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&fit=clip" srcset="https://images.theconversation.com/files/91265/original/image-20150810-11068-1efexp6.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=600&h=338&fit=crop&dpr=1 600w, https://images.theconversation.com/files/91265/original/image-20150810-11068-1efexp6.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=600&h=338&fit=crop&dpr=2 1200w, https://images.theconversation.com/files/91265/original/image-20150810-11068-1efexp6.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=600&h=338&fit=crop&dpr=3 1800w, https://images.theconversation.com/files/91265/original/image-20150810-11068-1efexp6.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&h=424&fit=crop&dpr=1 754w, https://images.theconversation.com/files/91265/original/image-20150810-11068-1efexp6.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=754&h=424&fit=crop&dpr=2 1508w, https://images.theconversation.com/files/91265/original/image-20150810-11068-1efexp6.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=754&h=424&fit=crop&dpr=3 2262w" sizes="(min-width: 1466px) 754px, (max-width: 599px) 100vw, (min-width: 600px) 600px, 237px"></a>
<figcaption>
<span class="caption">The Crime Triangle theory as to why crime occurs.</span>
<span class="attribution"><span class="source">Terry Goldsworthy</span></span>
</figcaption>
</figure>
<p>The NSW Taxi Council’s claim that using an Uber service is as dangerous as hitchhiking is not well supported by evidence. Clearly, it is not as dangerous. Uber drivers do undergo some background checking; in the hitchhiking scenario there is none. Second, in using an Uber app, the passenger creates an electronic record of their interaction with the provider. </p>
<p>This is something that would be of crucial importance to investigators later, as it would allow the driver to be identified. The app and its electronic record provides guardianship and makes the offence less appealing to a potential offender. It may not stop the offence, but it will certainly aid in solving it. The same can be said for booking a taxi online, use of in-taxi cameras and GPS tracking for both taxis and Uber.</p>
<p>Violent crime is not unique to rideshare app users. In past years, a number of concerns have been raised in <a href="http://www.theage.com.au/victoria/we-cant-ignore-the-reality-of-cab-attacks-20130920-2u56s.html">Australia</a> and <a href="http://www.gatestoneinstitute.org/3854/uk-taxi-rapes">overseas</a> about sexual offences committed by taxi drivers against passengers. </p>
<p>In some regards, Uber is <em>more</em> traceable due to it operating through technology. Compare that to a taxi fare picked up on the side of the road. Although most taxis now have GPS tracking and in-car cameras, these are only of use once the taxi used in the offence has been identified. It is for this reason that the <a href="https://www.police.qld.gov.au/programs/cscp/personalSafety/adults/safetyonpublictransport.htm">Queensland Police Service</a> advises people to book a taxi (electronically, via phone or SMS) in preference to hailing one. A record is kept by taxi companies of all bookings made.</p>
<h2>Little – if any – empirical data</h2>
<p>Much of the debate is relying on single cases or anecdotal evidence. There is little – if any – empirical data available to draw a valid comparison between Uber and taxis drivers and the crimes they may commit in the course of their employ.</p>
<p>In some jurisdictions, there is some limited data that has been made publicly available in relation to <a href="http://www.theage.com.au/victoria/police-target-taxi-crimes-20120331-1w5il.html">offences committed by taxis drivers</a>. </p>
<p>Uber, however, is an unknown beast. One <a href="http://www.theatlantic.com/technology/archive/2015/03/are-taxis-safer-than-uber/386207/">US news service</a> did try to unsuccessfully compare data for Uber and taxi crime from government sources. The reporters asked police departments in five cities — Boston, San Francisco, Chicago, New York, and Washington, D.C. — for information about assaults against passengers of taxis or Uber cars, finding that:</p>
<blockquote>
<p>None of them tracked violent crimes at that level. This is meaningful because it underscores how the narrative about ridesharing and public safety is largely anecdotal. It raises another question, too: If Uber is potentially unsafe for passengers, what about taxis?</p>
</blockquote>
<p>To ensure safety, Uber <a href="https://newsroom.uber.com/australia/2015/07/ubersafeau/">relies</a> on background checks, safe pickups, anonymous feedback, driver profiles and insurance and certain vehicle standards. </p>
<p>The taxi industry argues that this falls short of its requirements, but does not provide empirical data to show that ridesharing is no safer than hitchhiking.</p>
<h2>Verdict</h2>
<p>The claim that ridesharing is no safer than hitchhiking is not supported by empirical data. Much of the data used by critics of Uber rely on anecdotal data and media reports to support their view ridesharing puts passengers at personal risk. </p>
<p>In general terms, a Uber service is safer than hitchhiking due to the safeguards built into the Uber system. Is it as safe as catching a taxis? The answer to this remains unknown due to a lack of data and empirical research. </p>
<hr>
<h2>Review</h2>
<p>I concur with this assessment. In order to sustain the claim made, there would need to a systematic comparison of the experiences of hitchhikers and Uber passengers. There is no study of this kind, it would appear, or those making the claim would presumably have referred to it. </p>
<p>Anecdotal accounts, while making good news copy at times, prove nothing; as noted, anecdotes can also be found to indicate dangers in the regulated taxi industry. It should be borne in mind that there is powerful negative symbolism associated with hitchhiking in New South Wales not least because of the <a href="http://guides.sl.nsw.gov.au/content.php?pid=242811&sid=2075601">Ivan Milat</a> cases. </p>
<p>To invoke that association even implicitly or subconsciously in relation to the activities of one’s competitors is a tactic likely to be effective in terms of raising public fears about the safety of alternatives to regulated taxis. <strong>– Andrew Goldsmith</strong></p>
<hr>
<p><em>Correction: An earlier version of this article included a comment from the NSW Taxi Council that there is no mandatory maximum age for ridesharing vehicles. In fact, Uber does have a mandatory maximum age for vehicles.</em></p>
<p><div class="callout"> Have you ever seen a “fact” that doesn’t look quite right? The Conversation’s FactCheck asks academic experts to test claims and see how true they are. We then ask a second academic to review an anonymous copy of the article. You can request a check at checkit@theconversation.edu.au. Please include the statement you would like us to check, the date it was made, and a link if possible.</div></p><img src="https://counter.theconversation.com/content/45878/count.gif" alt="The Conversation" width="1" height="1" />
<p class="fine-print"><em><span>Andrew Goldsmith has received funding in the past form the ARC. </span></em></p><p class="fine-print"><em><span>Terry Goldsworthy does not work for, consult, own shares in or receive funding from any company or organisation that would benefit from this article, and has disclosed no relevant affiliations beyond their academic appointment.</span></em></p>The NSW Taxi Council says ridesharing platforms like uberX are no safer than hitchhiking. Is that supported by the evidence?Terry Goldsworthy, Assistant Professor in Criminology, Bond UniversityLicensed as Creative Commons – attribution, no derivatives.tag:theconversation.com,2011:article/424832015-06-09T19:58:30Z2015-06-09T19:58:30ZUber ‘micropreneurs’ signal the end of work as we know it<figure><img src="https://images.theconversation.com/files/84278/original/image-20150608-8732-v8up3x.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=496&fit=clip" /><figcaption><span class="caption">The sharing economy is moving rapidly but we haven't yet figured out how it will impact traditional workplace norms.</span> <span class="attribution"><span class="source">Image sourced from Shutterstock.com</span></span></figcaption></figure><p>If you are a driver for Uber or ride-sharing platform Lyft, a host on AirBnB, or a “tasker” doing odd jobs on TaskRabbit, you may consider yourself what has been recently labelled a “<a href="http://www.fastcoexist.com/1679903/the-rise-of-the-micro-entrepreneurship-economy">micropreneur</a>”.</p>
<p>Making money from your idle capacity – be that time and skills, or assets such as your spare room, car, or driveway – is made easy by firms offering platforms to connect supply and demand in the <a href="http://www.forbes.com/sites/jacobmorgan/2014/10/16/why-the-collaborative-economy-is-changing-everything">collaborative economy</a>. </p>
<p>Such platforms, many initially based on connecting neighbours and communities, and/or driven by a social purpose (hence the earlier label of the <a href="http://en.wikipedia.org/wiki/Sharing_economy">sharing economy</a>), have also led to the emergence of global giants, some with capital valuations of over US$<a href="http://www.bloomberg.com/news/articles/2014-12-04/uber-valued-at-40-billion-with-1-2-billion-equity-fundraising">40 billion</a>. Their profit-driven business models are also disruptive for traditional industries, such as transport, <a href="http://www.forbes.com/sites/joeharpaz/2014/05/07/airbnb-disrupts-hotel-economy-sends-regulators-scrambling">accommodation</a>, and <a href="http://pwc.blogs.com/industry_perspectives/2015/02/">logistics</a>. </p>
<p>Suppliers are often referred to as “hosts”, members of a “community”, or “partners”; even their logos are co-created and “<a href="http://blogs.ft.com/tech-blog/2014/07/airbnb-new-logo-belo">belong to everyone</a>”. The main attraction for suppliers, or rather “workers”, on these platforms, is – unsurprisingly – the <a href="http://www.requestsforstartups.com/survey">flexibility</a> they offer in earning extra income. And it’s not just basic services that are supplied. Recent <a href="http://www.afr.com/brand/boss/how-online-marketplaces-will-replace-the-big-services-firms-20150312-13ht9v">reports</a> suggest these types of platforms have the capacity to enter more specialised industries such as professional services, for instance, online marketplaces for <a href="http://techcrunch.com/2014/12/09/upcounsel-2-4m/">legal services</a>. Here, the average supplier is highly qualified, often providing niche legal services. Interestingly, anecdotal reports suggest that large firms may be using this flexible supply option to scale up and down their internal legal services as needed. </p>
<p>So, working in the collaborative economy offers significant flexibility and the opportunity for almost everyone to become entrepreneurial. This is especially the case for students, stay-at-home parents, and retirees (according to a recent <a href="http://www.requestsforstartups.com/survey">survey</a>). </p>
<figure class="align-center ">
<img alt="" src="https://images.theconversation.com/files/83754/original/image-20150603-19255-tjzoxe.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&fit=clip" srcset="https://images.theconversation.com/files/83754/original/image-20150603-19255-tjzoxe.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=600&h=400&fit=crop&dpr=1 600w, https://images.theconversation.com/files/83754/original/image-20150603-19255-tjzoxe.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=600&h=400&fit=crop&dpr=2 1200w, https://images.theconversation.com/files/83754/original/image-20150603-19255-tjzoxe.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=600&h=400&fit=crop&dpr=3 1800w, https://images.theconversation.com/files/83754/original/image-20150603-19255-tjzoxe.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&h=503&fit=crop&dpr=1 754w, https://images.theconversation.com/files/83754/original/image-20150603-19255-tjzoxe.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=754&h=503&fit=crop&dpr=2 1508w, https://images.theconversation.com/files/83754/original/image-20150603-19255-tjzoxe.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=754&h=503&fit=crop&dpr=3 2262w" sizes="(min-width: 1466px) 754px, (max-width: 599px) 100vw, (min-width: 600px) 600px, 237px">
<figcaption>
<span class="caption">Not everyone is happy about the sharing economy.</span>
<span class="attribution"><span class="source">Scott L/Flickr</span>, <a class="license" href="http://creativecommons.org/licenses/by-sa/4.0/">CC BY-SA</a></span>
</figcaption>
</figure>
<p>But on the <a href="http://www.fastcompany.com/3027355/pixel-and-dimed-on-not-getting-by-in-the-gig-economy">down side</a>, a lot of uncertainty comes with such work. This wouldn’t surprise those who are already freelancers, moving from gig to gig. Newcomers, however, have to come to grips with having less security and no guaranteed income, fixed benefits, or other standard worker protections. They also have to deal with platforms that are often run via algorithms that demand potential suppliers rapidly respond to customer enquires - or they risk reduced performance ratings, potentially putting off new clients. Seen that way, not much self-determination remains, and traditional <a href="http://en.wikipedia.org/wiki/Scientific_management">scientific management</a> reigns. But perhaps this is just the high-speed, tech version of existing independent contracting. </p>
<p>There are some interesting developments in the relationship between workers and online platforms, though. For example, in a <a href="http://www.wsj.com/articles/can-the-sharing-economy-provide-good-jobs-1431288393">report in the Wall Street Journal</a> on whether the sharing economy can provide “good jobs”, collaborative economy thought leader <a href="http://rachelbotsman.com">Rachel Botsman</a> says organisations such as <a href="http://www.peers.org">Peers.org</a> and <a href="https://www.freelancersunion.org">Freelancers Union</a> “are creating ways for independent contractors to pool bargaining power to access discounted health insurance and telecom plans. Some platforms are looking at how they can give providers equity, to share value with the people creating the value”. Does that mean, in turn, we will see the collective spirit of the “community” of workers crafted and managed by these platforms <a href="http://www.ft.com/intl/cms/s/0/1919fc24-c5b0-11e4-bd6b-00144feab7de.html#axzz3bFVAH8Lu">rise up against a platform itself</a>?</p>
<p>Adding to the complexity is the question of whether the suppliers of work are contractors - or essentially employees. The jury is out. Actually, it really is: <a href="http://www.bostonglobe.com/business/2014/08/16/sharing-economy-are-workers-employees-independent-contractors/6GTpn1a735kNiM7T7k2vtO/story.html">Class action law suits</a> against Uber and Lyft, as a start, are challenging the classifications of freelancer or contractor versus employee (a legal classification that demands benefits and protections). These issues are also drawing attention in <a href="http://www.afr.com/news/economy/labor-stakes-a-claim-on-the-sharing-economy-for-workers-20150323-1m5okn">Australia</a> and elsewhere. </p>
<p>It is a rapidly evolving space. In the past five years, this social movement has already been relabelled several times – from “sharing”, to “collaborative”, to - more recently – the “gig” or “peer economy”. It is no longer about <a href="http://www.wsj.com/articles/how-everyone-gets-the-sharing-economy-wrong-1432495921?KEYWORDS=sharing+economy">criticising</a> the sharing economy for not only being about sharing, but about the broader questions and important <a href="http://techcrunch.com/2014/06/09/the-future-of-work-in-the-sharing-economy-with-esther-dyson-ron-conway-and-john-hennessy/">debates</a> we need to have on the <a href="http://www.aspeninstitute.org/about/blog/future-work-sharing-economy">future of work</a>, <a href="https://agenda.weforum.org/2015/05/what-is-the-future-of-work-travel-mobility/">skills development</a>, and issues of inclusion when it comes to sharing the created value. </p>
<p><a href="http://webuser.bus.umich.edu/gfdavis/Presentations/Davis%20CES%20talk%203-15-15.pdf">Evidence</a> has been mounting about the coming <a href="https://michiganross.umich.edu/faculty-research/faculty/jerry-davis">collapse of the traditional corporation</a>, and the end of the “<a href="https://www.freelancersunion.org/blog/dispatches/2015/05/21/need-more-proof-era-big-work-over-here-it/">Era of Big Work</a>”. As we shift from jobs to tasks and projects, how can we avoid the possible deterioration of social standards due to lower income and reduced worker protection, as raised in recent <a href="http://www.eurofound.europa.eu/sites/default/files/ef_publication/field_ef_document/ef1461en_3.pdf">reports</a> by the European Union? </p>
<p>At the <a href="http://www.sbs.ox.ac.uk/programmes/degrees/mba">University of Oxford</a>, and in the first MBA course dedicated to the collaborative economy, an important question is being asked: Can decentralised and distributed networks of labour actually contribute to the redistribution of wealth? As rising inequality is recognised not only as a local but a global socio-economic concern, what role will micro-entrepreneurship play? This isn’t just about more informal employment relationships, we think, but about the bigger questions of social contract, rights, duties, and responsibilities in this emerging ecosystem of work and community.</p>
<hr>
<p><em>The lead author thanks Rachel Botsman and Pamela Hartigan, Skoll Centre for Social Entrepreneurship, University of Oxford, for the opportunity to discuss these issues and recent developments.</em></p><img src="https://counter.theconversation.com/content/42483/count.gif" alt="The Conversation" width="1" height="1" />
<p class="fine-print"><em><span>Danielle Logue is Visiting Fellow at The Skoll Centre for Social Entrepreneurship, Said Business School, University of Oxford.</span></em></p><p class="fine-print"><em><span>Markus A. Höllerer does not work for, consult, own shares in or receive funding from any company or organisation that would benefit from this article, and has disclosed no relevant affiliations beyond their academic appointment.</span></em></p>With the momentum of the sharing economy growing, we’re only just starting to come to grips with what it means for the future of work.Danielle Logue, Senior Lecturer in Strategy, Innovation & Organisation, University of Technology SydneyMarkus A. Höllerer, Senior Scholar, UNSW SydneyLicensed as Creative Commons – attribution, no derivatives.tag:theconversation.com,2011:article/421142015-05-22T04:52:08Z2015-05-22T04:52:08ZGST and ride-sharing: why the ATO believes Uber must pay<figure><img src="https://images.theconversation.com/files/82654/original/image-20150522-12512-61ag2x.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=496&fit=clip" /><figcaption><span class="caption">Uber drivers have been classified as taxi drivers and will have to register for GST. Uber says they will challenge the decision</span> <span class="attribution"><span class="source">MAHATHIR MOHD YASIN / Shutterstock.com</span></span></figcaption></figure><p>Are Australian Uber drivers taxi drivers? Uber says they are not, but a recent Australian Taxation Office advisory on the <a href="https://www.ato.gov.au/Business/GST/In-detail/Managing-GST-in-your-business/General-guides/The-sharing-economy-and-tax/">tax and the sharing economy</a>, says they are, and must therefore register for GST from 1 August. </p>
<p>Uber has hit back at this decision, stating that <a href="http://blog.uber.com/ATO-guidance">its “driving partners</a> should be treated no differently to any other independently-operated micro or small businesses, and other sharing economy participants.” It has said it will challenge the decision.</p>
<p>So what is the situation?</p>
<h2>When does a person or entity have to register for GST?</h2>
<p>Under the GST Act, you are required to be registered for GST if you are carrying on an enterprise and your GST turnover meets the registration turnover threshold (currently $75,000 per annum). Enterprises with an annual turnover below this threshold can register for GST, although they are not required to do so. </p>
<p>However, this registration threshold does not apply to those who provide taxi travel as part of their enterprise – they are required to be registered for GST regardless of the level of turnover. This was to avoid confusion over pricing if some were registered for GST and others were not.</p>
<h2>Are Uber drivers providing taxi travel?</h2>
<p>Taxi travel is defined in the GST Act to mean “travel that involves transporting passengers, by taxi or limousine, for fares”. “Taxi” is not defined in the legislation and must therefore take its ordinary meaning. In a 2002 <a href="http://law.ato.gov.au/atolaw/view.htm?rank=find&criteria=AND%7Ecompulsory%7Ebasic%7Eexact&target=J%20JA&style=html&sdocid=AID/AID200223/00001&recStart=1&PiT=99991231235958&recnum=9&tot=47&pn=ALL:::J">Interpretative Decision</a>, the ATO referred to the Macquarie Dictionary definition of taxi as meaning “a motor car for public hire, especially one fitted with a taximeter”.</p>
<p>Uber has responded to the new ATO guidance by arguing that “ridesharing is not a taxi service”. While there is no one agreed-upon definition of ride-sharing, the ATO has noted that the information they released does not apply to non-commercial car-pooling or car-sharing arrangements.</p>
<p>Based on previous ATO decisions, the critical issue in determining whether Uber drivers are providing taxi transport is whether the vehicles used are available for public hire. </p>
<p>Uber has highlighted the fact that drivers cannot accept street hails, cannot wait at taxi ranks and do not use taxi meters. But the vehicles used by Uber drivers <em>are</em> available for public hire – members of the public use the Uber app on a smart phone to book the service. </p>
<p>So while the method of booking the service may be different to a conventional taxi service, the service being provided is the same as that provided by a conventional taxi driver.</p>
<h2>What happens if a driver doesn’t register for GST?</h2>
<p>A person who is required to register for GST and fails to do so is liable to a penalty of up to $3,400. Additionally, failure to register will not remove the liability of the driver to pay GST to the ATO or to lodge GST returns. </p>
<p>While the GST is a consumption tax, borne by the final consumer, the liability to pay the GST sits with the person who makes a taxable supply. As transport services are not GST-free, they are taxable supplies if the person/entity providing them is registered or required to be registered for GST. </p>
<p>The ATO has deemed ride sharing drivers must register for GST, so a driver who fails to register for GST will still be liable to pay an amount of the fare paid by the customer to the ATO. Failure to lodge a business activity statement or remit GST to the ATO will also result in penalties and general interest charges.</p>
<p>The ATO has wide-ranging powers to access documents and collect information for the purpose of applying and administering the GST, and will be able to request information in relation to drivers and fares received from Uber (or similar companies). Penalties can also be imposed for failure to comply with these requests.</p>
<p>The ATO has specifically stated that they were not expressing a view on the legality of ride-sharing arrangements. An illegal business operation does not prevent income derived from that business from being subject to income tax. Similarly, there is nothing in the GST Act that prevents supplies of “illegal” goods and services from being subject to GST.</p>
<h2>Is the ATO singling out Uber?</h2>
<p>While there are income tax implications for those engaged in other “sharing economy” industries – such as accommodation sites like Airbnb – there will be no requirement to register for GST unless the $75,000 turnover threshold is met.</p>
<p>Uber has stated that the new ATO guidance “unfairly singles out the sharing economy”; however this is not the case. The ATO is singling out ride-sharing drivers, not because of their participation in the shared economy, but because of the services (that is, taxi transport) they are providing. </p>
<p>Taxi transport has always been treated differently to other industries under the GST Act. Requiring ride-sharing drivers to register for GST is simply ensuring that taxi services provided in a “shared economy” are treated the same way as those provided in a more traditional manner.</p><img src="https://counter.theconversation.com/content/42114/count.gif" alt="The Conversation" width="1" height="1" />
<p class="fine-print"><em><span>Kathrin Bain does not work for, consult, own shares in or receive funding from any company or organisation that would benefit from this article, and has disclosed no relevant affiliations beyond their academic appointment.</span></em></p>A recent decision by the tax office that ride sharing services must pay GST has infuriated Uber. But are they being singled out?Kathrin Bain, Lecturer, School of Taxation & Business Law, UNSW SydneyLicensed as Creative Commons – attribution, no derivatives.