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11 min read

    11 min read

    Harry here.  Today senior RSG contributor John Ince takes a look at an in-depth post from the New York Times about the psychological tricks Uber uses to push its drivers.  Companies have been using tricks like this for years to try and motivate their workers to do more with less, but it seems to be a bigger issue with Uber since they aren’t paying drivers like employees.  What do you think?

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    How Uber Uses Psychological Tricks to Push Its Drivers’ Buttons [The New York Times]

    Sum and Substance:  The secretive ride-hailing giant Uber rarely discusses internal matters in public. But in March, facing crises on multiple fronts, top officials convened a call for reporters to insist that Uber was changing its culture and would no longer tolerate “brilliant jerks.” Notably, the company also announced that it would fix its troubled relationship with drivers, who have complained for years about falling pay and arbitrary treatment.

    And yet even as Uber talks up its determination to treat drivers more humanely, it is engaged in an extraordinary behind-the-scenes experiment in behavioral science to manipulate them in the service of its corporate growth — an effort whose dimensions became evident in interviews with several dozen current and former Uber officials, drivers and social scientists, as well as a review of behavioral research.

    Uber’s innovations reflect the changing ways companies are managing workers amid the rise of the freelance-based “gig economy.” Its drivers are officially independent business owners rather than traditional employees with set schedules. This allows Uber to minimize labor costs, but means it cannot compel drivers to show up at a specific place and time. And this lack of control can wreak havoc on a service whose goal is to seamlessly transport passengers whenever and wherever they want. 

    Uber helps solve this fundamental problem by using psychological inducements and other techniques unearthed by social science to influence when, where and how long drivers work. It’s a quest for a perfectly efficient system: a balance between rider demand and driver supply at the lowest cost to passengers and the company. Employing hundreds of social scientists and data scientists, Uber has experimented with video game techniques, graphics and noncash rewards of little value that can prod drivers into working longer and harder — and sometimes at hours and locations that are less lucrative for them…

    Uber’s recent emphasis on drivers is no accident. …  an examination by The New York Times found that Uber is continuing apace in its struggle to wield the upper hand with drivers. And as so-called platform-mediated work like driving for Uber increasingly becomes the way people make a living, the company’s example illustrates that pulling psychological levers may eventually become the reigning approach to managing the American worker.

    Uber exists in a kind of legal and ethical purgatory, however. Because its drivers are independent contractors, they lack most of the protections associated with employment. By mastering their workers’ mental circuitry, Uber and the like may be taking the economy back toward a pre-New Deal era when businesses had enormous power over workers and few checks on their ability to exploit it.

    My Take:  Driving for Uber is simultaneously a humanizing and dehumanizing experience.  The interaction with the passengers is the humanizing part. As a driver you’re privy to real, often very revealing, conversations with real people. That’s the good side.

    The interactions with the company are another matter. In over two years driving for Uber, I’ve met just one human being – the guy who inspected my vehicle. This article delves into this dehumanizing aspect of our jobs, with big data collected on every aspect of our performance, used to automate messages and designed to manage a workforce that’s approaching a million drivers worldwide.

    Let’s not lose sight of the real objective here: get us to behave in ways that will benefit Uber’s bottom line.  Somehow that fine distinction between being an employee and an independent contractor seems to get more and more blurry every day. I’m curious how effective you think Uber’s psychology is.  I’m also curious  what the judges will say when Uber’s attorneys argue that drivers are truly independent – even though big data and Uber’s team of paid psychologists say otherwise.

    Travis Kalanick’s Ex Reveals New Details About Uber’s Sexist Culture [Huffington Post]

    Sum and Substance: Gabi Holzwarth was glad to be out of Uber’s orbit, which she described to The Huffington Post as a deeply misogynistic environment that was damaging to her psyche. But she got pulled back in with a phone call three weeks ago from a top Uber executive, who she says urged her to keep quiet about a 2014 incident at a South Korean karaoke and escort bar. 

    Holzwarth, though, says nothing will stop her from speaking out. For three years, while she was dating Uber CEO Travis Kalanick, Holzwarth ― a violinist and business development manager ― spent time at bars and parties surrounded by the men of Silicon Valley. If there were women around, she said, they were more likely to be models than other executives. “You go to an event and there’s just a bunch of models they’ve flown in,” Holzwarth, 27, told HuffPost. “That’s what they like to play with. That’s pretty much it.” It wasn’t a good situation for Holzwarth, who’s dealt with eating disorders for years.

    “As a woman struggling with my own insecurities and body image, the best thing for me was to leave that unhealthy world of impossible standards,” she said. (Holzwarth has credited Kalanick with helping her recover from her eating disorders.) Holzwarth’s story ― recently detailed at The Information ― is emerging amid a spiraling public relations disaster for Uber, partly as a result of allegations about its aggressive and sexist company culture.

    On Tuesday, for the first time, Uber released data about the gender, racial and ethnic makeup of its workforce. Like most of its competitors, the company is overwhelmingly white and male, particularly in its leadership and tech roles….

    Holzwarth says that in their phone call a few weeks ago, Michael told her that if anyone asked about that night, she should say it was just karaoke. Holzwarth said she spent a few anxious weeks stewing about that phone call before finally opening up about it to The Information. “I don’t want to be silenced or lie for somebody else. It made me feel uncomfortable,” she told HuffPost. “[It was a] tough three weeks of hiding their secret.” Michael disputes Holzwarth’s account of the phone call.

    My Take:  Not a whole lot of breaking news in this account, but what’s there is pretty salacious.  We’ve reached a phase in the media coverage of Uber where many news outlets are just piling on and rehashing old incidents.  They attempt to fit every morsel of Uber-news into the prevailing narrative, summed up as simply: Uber – The Bad Boys of Tech.

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    But what’s really interesting here is that this article was written by the executive editor for technology of the Huffington Post – just about the same time that Arianna Huffington was on a conference call (acting as a spokesperson and Director of Uber) talking with the New York Times and other major media outlets.  Huffington is trying to rescue the Uber narrative from the wolves, while her old company and namesake publication (which was sold to AOL) is eating away at the flesh of the new company she represents.

    Criminal charges come up as Google, Uber spar over Waymo lawsuit [SF Gate]

    Sum and Substance: An Uber executive accused of stealing driverless car technology from his former employers at Google is exercising his Fifth Amendment right to avoid self-incrimination, according to his lawyers. The lawyers for Anthony Levandowski, the former head of Google’s self-driving car project who is now leading a similar effort at Uber, said he was broadly asserting his Fifth Amendment rights because there is “potential for criminal action” in the case, according to court transcripts released Thursday.

    The legal maneuver adds even more intrigue to the high-profile fight between two of the technology industry’s largest companies, which are squaring off in the race to put driverless cars on the road. Levandowski is at the center of the lawsuit between Uber and Waymo, which was spun out from Google to become its own Alphabet subsidiary. Waymo has accused Levandowski of stealing documents and poaching employees before quitting Google and then colluding with Uber to use that technology to advance driverless car efforts at the ride-hailing service.

    Shortly after leaving Google, Levandowski started his own self-driving truck startup, Otto. Six months after Otto was formed, Uber acquired the company for $680 million.

    Waymo filed a motion seeking a temporary injunction this month to stop Uber’s driverless-car development. In the transcript of a private hearing before Judge William Alsup in U.S. District Court in San Francisco, Levandowski’s lawyers said he was invoking his Fifth Amendment right to avoid incrimination in turning over documents relevant to the case. Uber’s lawyers said they have made clear to Levandowski that he needs to release any documents relevant to the case as part of discovery.

    Several months before filing a lawsuit against Uber, Google demanded arbitration against Levandowski, claiming that he used confidential salary information while trying to poach former colleagues for his new venture. Google’s previously undisclosed legal action against him came out in a motion filed by Uber’s lawyers Wednesday. Uber wants to settle the lawsuit in arbitration, arguing that Waymo’s claims stem from Levandowski’s time at Google and are covered by an arbitration clause in his employment contract. Arbitration is usually less expensive and proceeds faster than a federal lawsuit. It is not argued in front of a jury, and arbitration hearings are not part of the public record.

    My Take:  This is getting nasty.  Are there any lawyers out there reading this post that have some insight into how this one might turn out? From my seat way up in the bleachers, I can’t see how Uber can come out of this one looking good.  They’re trying to minimize the PR damage and potential financial damages by pushing it into arbitration.

    For those who followed the independent contractor/employee lawsuit still working its way through the courts in California, Uber’s “push it into arbitration” strategy may sound familiar.  Uber argues in that lawsuit that their arbitration clause is valid for all drivers even thought it’s foisted upon us.  How many drivers actually read the fine print of these long agreements before you go online and effectively wave all your rights? It’s the same argument in this case. Uber is trying to get Google/Waymo testimony out of the courts and out of the public eye. Looks to me like Uber’s driverless car strategy is going to be tied up in the courts for a long time.

    Uber now allowing Phoenix teens to request rides [12 News]

    Sum and Substance: PHOENIX – Uber just rolled out a new pilot program that allows teens to request rides. Uber Teen was recently rolled out in Seattle, Columbus and right here in Phoenix. “This was launched because of significant demand from parents that are juggling their busy schedules along with their kids busy schedules,” said Uber spokesperson Taylor Patterson. The only way teens can start requesting rides is if the parents invite them into a family account. “Parents have to give explicit permission to opt in their teenagers,” said Patterson.

    Once the account is set up, teens will have the freedom to request Uber rides 24 hours a day. Whether it’s getting picked up from school, practice or getting a ride to a friends house. They won’t have to carry money either because it will all be deducted from their parents account. “Once the teen is using the service, parents will get real time notifications informing them of all aspects of the trip. From where they are going, to following the ride on a detailed map and if they aren’t dropped off within 1,000 meters of the set destination, parents will also be notified of that,” said Patterson. … The Uber Teen program is set to roll out into more cities in the near future.

    My Take:  Not quite sure what to make of this move. In my area, teens request rides all the time, and it always puts us drivers in an awkward position. Parents just assume it’s the responsible thing to do – to set up an account for their teenage kids, just in case they’ve been drinking.  Drivers are caught in the middle.  We never know how old our passenger is until we arrive, and even then it’s often not clear whether they’re under 18 or not.  So do we refuse the ride request – forfeit the fare – and waste our time in the process?

    Related: 10 Tips for Driving and Dealing with Teens

    So I suppose I should be glad that Uber is starting to legitimize this. But another part of me remains concerned. While some parents (and teens) will use the Uber Teen service responsibly, like for picking teens up from school, shuttling them to and from practice or friends’ houses, etc., some won’t. Some parents and teens will use Uber Teen because they’ve been drinking at night. And you thought drunk adults were bad… wait until you get a drunk teen.

    Readers, what do you think of this week’s stories? Are you surprised or not really by Uber’s insane culture, and do you think anything will change? How do you feel about the new Uber Teen service rolling out – are teens easier or more difficult as passengers than adults?

    -John @ RSG

    John Ince

    John Ince

    John Ince is a former Fortune reporter and Wall Street banker. He has about 1,000 rides under his belt driving part time for Uber and Lyft.  He’s writing a book about his experiences entitled:  Travels With Vanessa:  A Rideshare Driver Tries To Make Sense of It all - For a sneak peak visit the link above.