A year ago, Uber allowed its drivers in California to see travel destinations before picking up passengers and allowed them to set prices in an effort to prove that drivers were actually independent contractors. It was part of the company’s strategy to prevent drivers from being reclassified as employees under AB5, California’s street work law.
Uber is now recognizing that the change has hurt business and is considering cutting back on its visible destinations and pricing policies, The Chronicle found. The seesaw can disappoint drivers who have enjoyed this extra control over their work.
Many drivers choose profitable races and refuse other orders, making the service unreliable, the San Francisco company said on Monday. Uber no longer has to worry about proving that drivers are hired independently, because Proposition 22 – the November electoral measure by which Uber and other show companies spent $ 220 million to approve – enshrines its status as non-employees.
“Uber is reevaluating the previous changes we made in California so that we can make it more reliable,” the company told The Chroncle.
In January 2020, days after the AB5 went into effect, Uber made the changes, saying they were “due to new state laws” and warning riders that they might have a harder time finding a ride. AB5 makes it more difficult for companies to claim that workers are not employees. It is based on a test that says workers are employed, unless they work free from the company’s control, do not work at the core of the company’s core business, and have their own independent companies in that line of work.
Uber’s goal was to show that drivers had more freedom and flexibility and therefore met these requirements. Drivers could set their own price as a multiple of an Uber base price, see where passengers were going and reject travel requests without penalty. Passengers no longer saw prices before a trip.
Uber argued in court last summer that drivers’ ability to see destinations and set prices meant that they were really independent. California and three city prosecutors are suing Uber and rival Lyft over the driver’s rating on AB5, in a case that continues, but will now only review the conduct before Proposal 22 goes into effect.
But in the streets, the shot backfired. A third of California’s drivers have cut more than 80% of their ride orders, making the service unreliable, Uber said this week. About a fifth of potential passengers in California now end up not finding a trip, an increase of seven times over the previous one. The pandemic has further restricted the number of drivers, who now have to face the risk of the virus.
The changes disproportionately affected airports, said Uber. Airport travel has long been the service’s lucrative backbone, and that’s where the company expects to see increased demand as more Americans start traveling when they get vaccinated.
The weekly travel completion rate at San Francisco and Los Angeles airports is less than 60%, by far the lowest for major airports in the country, Uber said.
Harry Campbell, a Uber and Lyft driver in Los Angeles who runs the blog and podcast The RideShare Guy, said drivers who work full-time like to have the additional controls so they can reap the maximum profit.
“In order to function as a full-time driver, you need to be very strategic,” he said. “Many drivers (previously) were shocked to discover that they did not know where a passenger was going until they accepted the trip. When Uber added the destination feature, it was a game changer for many drivers. “
But as a passenger, Campbell said he realized the service was worse.
Uber provided tweets to angry passengers who said they hated having to haggle over prices, were waiting longer for travel and were sometimes hijacked for higher rates at the last minute when they had no room to maneuver because of a flight to catch, for example.
“It’s been a pattern, a kind of provocation for Uber to give drivers the features they want and then take them out,” he said. “This type of resource was something that drivers have always wanted. I think drivers are going to be too upset ”to lose it.
Overall, Campbell thinks the flip-flip can drive drivers away, even with Uber now offering incentives to attract more people back to work.
“It’s been a pattern, a kind of provocation for Uber to give drivers the features they want and then take them out,” he said. “This type of resource was something that drivers have always wanted. I think drivers will be too upset ”to lose it.
Carolyn Said is a writer for the San Francisco Chronicle. Email: [email protected] Twitter: @csaid