Unmasking Uber and Facebook

Let’s stop pretending that Uber is just along for the ride in the gig economy and that Facebook is just a technology company.

gig

At first glance, the gig economy seems great: a way for individuals with an entrepreneurial spirit to improve themselves. The reality is that it’s a race to the bottom. For many workers, it’s all they have. They string together a number of insecure, low paying, temporary jobs to try to keep the wolf from the door.

Mortgage companies are reluctant to lend to those without secure work. Gig workers have trouble saving for retirement; they have no sick or maternity leave; no health care plans. Workers are easily abused because of the one-to-one relationship with employers.

It’s easy to become complacent if you have a reliable income. Someone like me, for example. On my visit Los Angeles last year I used Uber. I marveled at the technology that allowed me watch the car’s progress from blocks away on my tablet. I was impressed by the courteous driver and his new, clean car and the low fare.

But those of us with reliable incomes should worry as full-time positions are eroded by the gig economy.

Uber professes to be just an app that connects drivers with passengers; a dubious claim says Carl Mortished:

“That was Uber’s wizard scheme: to make money from millions of taxi journeys without actually employing a single driver or even being part of the transaction. It was about making money from the gig economy without doing a single gig (Globe and Mail, November 4, 2016).”

Judges in England found Uber’s claim that it was not an employer to be unbelievable. Drivers have no control over choice of customers, fares, and routes traveled. They are subject to a rating system that amounts to a disciplinary procedure. Judges ruled that drivers were entitled to minimum wages and paid holidays.

Facebook harbors its own pretensions. At an event in Rome last year, an audience member asked founder Mark Zuckerberg if Facebook was an “editor in the media?” He replied that Facebook does not produce content but merely “exists to give the tools to give you the tools to curate and have the experience to connect to the world that you want.” Mortished disagrees:

“What Mr. Zuckerberg says is untrue. Facebook is editing and making content. Facebook is paying millions of dollars to celebrities and other media organizations to make videos for Facebook Live.”

Facebook edits its website: banning, deleting and restricting content that doesn’t fit their rules. They ran into a storm of protest when editors deleted the famous Vietnam War photo of naked girl fleeing an American napalm attack.

Facebook should grow up. It’s no longer the college photo-sharing web site it once was. Facebook would prefer not to be classified as a publisher because it would find itself in the messy business of being responsible for content that might be offensive, defamatory, or potentially criminal.

I’m not against Uber. Properly implemented, it could improve taxi service and provide fair working conditions for drivers. I like Facebook. It keeps me in touch with friends and family. But let’s avoid the charade, Mr. Zuckerberg, of the exact nature of the business that you’re in.

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Uber Apploitation

When I fly to Los Angles next week, I was going to take an Uber taxi. Now I’m not so sure after reading Andrew Callaway’s article in the CCPA Monitor.

George, 35, protests with other commercial drivers with the app-based, ride-sharing company Uber against working conditions outside the company's office in Santa Monica, California June 24, 2014. REUTERS/Lucy Nicholson (UNITED STATES - Tags: BUSINESS EMPLOYMENT TRANSPORT CIVIL UNREST) - RTR3VKJ9

George, 35, protests with other commercial drivers with the app-based, ride-sharing company Uber against working conditions outside the company’s office in Santa Monica, California June 24, 2014. REUTERS/Lucy Nicholson 

“Oh, Canada! I’m writing you from Berkeley, California to warn you about this thing called ‘the sharing economy.’ Since no one is really sharing anything, many of us prefer the term “the exploitation economy,” . . . Whatever you want to call it, the basic idea is that customers can outsource all the work or chores they don’t want to do to somebody else in their area.”

Since phone apps can be used to order just about anything you want from groceries and restaurant food to laundry pickup and house cleaning, the exploitation economy might be better labelled as the “apploitation economy.”

On the surface, the sharing economy seems ideal. Independent workers can pick up jobs whenever and wherever they want. But dig deeper and you find that drivers are not so independent. They certainly are not employees. If they were employees, they would receive fixed wages and benefits, deductions for employment insurance, Canada Pension Plan, and taxes.

If Uber drivers were truly independent, they could control their rates and  conditions of work. Callaway soon found out some of the drawbacks when he worked for a company similar to Uber called Lyft. He found out that, without warning, ride-sharing companies will lower drive wages. By the time drivers notice the cut, they have invested in cars and are stuck in the job.

Ride-sharing companies are careful not to send drivers to pick up specific passengers because that would make them employees. Instead, drivers are given red zones which supposedly indicate where passengers will likely be. But by the time that other drivers move to the zones, the likelihood is reduced. It’s inefficient for the drivers but avoids the company’s responsibility.

If drivers don’t like the arrangement, why do it? “Realistically, people aren’t driving around strangers because they love it. The most common defence of the sharing economy I hear is, ‘if it’s so bad, why are so many people doing it?’ Many do it out of desperation. I’ve talked to a number of drivers who will work over 30 hours every weekend in addition to a full-time job just to have enough money to pay rent and take care of their kids.”

And if drivers like conditions so much, why do they want to organize unions to protect themselves? Seattle City Council recently approved a bill that would allow drivers for ride-sharing apps to form unions. The vote is a victory for the App-Based Drivers Association (ABDA) of Seattle, an organization of on-demand contract workers that lobbied for the legislation. Union organizers in California have said that the Seattle vote could influence actions taken in their own cities.

Ottawa recently joined Edmonton as the second Canadian city to legalize Uber. The move will put pressure on others. Canadian cities need to pay attention to the American experience and get ride-sharing right by easing restrictions on taxis and reducing apploitation. If Uber really wants to provide a useful service, it needs to treat drivers fairly by allowing greater rate control and working conditions.