Harry here. In case you missed it, I’ve been gone for a week hiking Machu Picchu and without internet. I’ll be back in a couple days but today, RSG contributor, Christian Perea, picks up the slack while I’ve been gone. I heard about this issue as I was leaving and Christian spent the week researching what happened, talking to drivers and figuring out what went down.
On September 17th and 18th, a large group of UberX drivers in Los Angeles and the Bay Area attempted to log into their Uber app only to find out that they were no longer Uber drivers. Drivers reported having not received any information prior to being deactivated and the resulting loss of wages for drivers affected their ability to make ends meet. Further more, the resulting surge pricing while Uber “wait-listed” its drivers, gouged passengers in need of a ride.
Drivers in Los Angeles also learned that Uber had decided to close its local offices the following day preventing them from getting the answers they needed to get back on the road.
Upon contacting Uber, the drivers were eventually informed that they had been “wait-listed” for 24 hours due to having a high cancellation rate, even though many had not been notified or warned. During this whole process, drivers were still unsure whether or not they were even going to be able to drive again.
This particular driver from the Bay area pointed out that there was no provision in the Uber partner contract regarding the cancellation rates for drivers. There was a provision concerning accepting requests, but none on cancellations. The Uber representative simply directed the driver to provision 12.2 of the partner contract.
One LA driver from the Uber Woman Driver’s Network on Facebook stated that Uber had sent out texts to some drivers warning them to maintain a high acceptance rating even though her acceptance rating was above 90% per Uber’s weekly stats email that it sends out to drivers. After an extensive back and forth with Uber support, the driver was reactivated with a “sorry, you are all clear” e-mail. But she still wasn’t able to work during the time she was deactivated.
This LA driver was instrumental in rallying a group of drivers to go to the Uber office when it reopened and pointing out the segment in her contract where it explicitly states that partners have the right to decline rides pursuant to Uber’s current cancellation policy (which is not stated or communicated to all drivers, and even difficult to obtain from an Uber CSR.). The Uber representative only agreed to help one member of the group that arrived.
Most of the drivers that I spoke with did not want to be quoted or revealed, due to a prevailing fear of being deactivated or intimidated further by Uber. This isn’t unwarranted as it has happened to other drivers.
I spoke with Brian Navarro (@tncmylife) who gives drivers advice on how to be profitable. He received no texts, emails, or notifications from Uber until he had been wait-listed and wrote into Uber’s team to ask why. He said that his primary worry during the entire debacle was on how many other drivers were affected by Ubers actions. He also stated that.
Uber markets to drivers that they are independent contractors and have all of this freedom as a recruiting tool. Yet they deactivate them for exercising their freedoms as an independent contractor and we are all left wondering what the rules and relationships are.
Apart from these drivers, many other drivers posted the ensuing chaos to their local Facebook groups as they collectively tried to piece together what was happening to them. It became clear from the mass posts that this was a large scale action against drivers and further fueled anger and speculation within the lounges.
Resulting Driver Shortage = MASSIVE SURGE PRICING
Enough drivers were wait-listed to cause a massive amount of surge in Los Angeles.
It’s one thing to be so cavalier as to punishing drivers but it’s another to pass it on to passengers. The resulting driver shortage created surge pricing that would turn a $15 dollar ride into a $75 dollar ride.
In this particular case, surge blew up because there weren’t enough active drivers as a result of Uber deactivating so many drivers. The resulting skyrocketing prices may have helped Uber curb its losses from taking a large portion of its “partners” offline for 48 hours.
As a driver, had I logged into see this EVEN on a Friday night in LA I would have logged off and started checking the news for things like “Zombie Attacks” and “Russian Land Invasion of Los Angeles”.
“Rider Requested Cancel”
For the uninitiated, many drivers have been known to accept an Uber request and then cancel it under “Rider Requested Cancel”. This allowed drivers to screen calls without lowering their acceptance rate with Uber.
Many drivers would do this and wait until a surge request came in to take a call at a higher price. Uber claims that this practice makes the user experience less dependable while drivers claim that they should have a right to accept or deny requests.
Although many consider this tactic to be questionable, it has become more commonplace as Uber has ruthlessly lowered driver pay throughout most markets, thus forcing drivers to be more picky about the rides they give.
In many markets, Uber drivers earn as little as $2.40 for a minimum fare ride. Even though these rides often require the driver to work for up to 30 minutes while fulfilling the request. Keep in mind that drivers foot the bill for all expenses along the way. Drivers colloquially refer to these as “free rides”.
So in effect, Uber squeezes its drivers, then the drivers end up squeezing passengers. We all end up with a terrible experience.
Uber is valued at 50-something billion dollars right now. It has the wherewithal to investigate drivers on a per-case basis upon flagging them and it has a whole fraud division staffed by many capable employees.
It also has the ability to flag these drivers as engaging in these behaviors since that is exactly what they did. They still refused to send a text, email, or dare I say…phone call to its drivers to warn them that they are at risk of being deactivated and to stop cancelling so many rides.
So to me at least, it is very clear that this was a calculated action meant to shake up Uber drivers and to create buzz. I will say it certainly worked.
The fact that the Uber office mysteriously closed the following day just adds an extra slap in the face to drivers. Uber did this to demonstrate that it can deactivate drivers at will and is willing to do so to make a point. The resulting increase in surge pricing for its customers also demonstrates a lack of empathy towards its very own customer base.
At the end of the day, the effective message Uber sent to its driver workforce was “You will play by our rules or we will cut you down!”
In the end, this stands out as a huge example of the sort of uncertainty and unpredictability that 1099 workers face everywhere. It is a blatant example of how a company like Uber can completely screw its workforce in an instant and without notice.
So meet the new Boss. Same as the old Boss.
I would like to thank the many drivers who reached out to me for helping me with this article. You know who you are ; )
I reached out to Uber for comment and have no heard back from them at this time.
Don't Get Burned On Long Distance Trips.Automatically track your miles on the return trip with QuickBooks Self-Employed. Deduct the miles there and back.
-Christian @ RSG
Latest posts by Christian Perea (see all)
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