After a new state law just took effect with the intention of protecting gig-economy workers, Uber is taking the position, temporarily, that it just has to make some changes to its driver-side app to comply with the law. And those changes are likely to impact riders across the board.
The changes, according to a memo sent out Wednesday to Uber drivers across California, include giving drivers more upfront information about their trips — and therefore allowing them to refuse trips based on their destination, estimated length, or their estimated fare. Riders will now be shown estimated fare ranges instead of firm prices, and all this likely adds up to ever more expensive rides.
But on the minus side, one of the reasons Uber and Lyft implemented app changes that removed exact destinations several years ago was that it was leading to discrimination — with drivers deciding they wouldn't go to certain neighborhoods. Uber says it will be tracking this and trying to guard against it, but... really?
Campbell further explains in a blog post that drivers' "Quests" — goal assignments offered by Uber that previously came with bonus payouts — will now come with fee discounts instead of cash bonuses. (This change seems geared toward getting around the part of AB-5 that makes such employee-esque shift bonuses illegal.) Drivers will now be able to opt to do 40 or 60 trips in a shift with the goal of getting the commission they pay out to Uber reduced after they reach that Quest quota. In other words, for the first 40 trips a driver will be losing the usual 25% take to Uber, but after that Quest is complete, the remainder of the trips in a given period will only be charged a 10% commission.
Campbell notes that all these changes, along with changes to how surge pricing works, will mean that drivers are going to start seeing the financial benefits of AB-5 immediately, even if they aren't being made into employees or offered benefits — which was originally the intent of the law.
What ultimately happens with AB-5 is still an open question though as legal challenges are pending. As one local attorney, Michele Ballard Miller, tells the Chronicle, "This is Uber's fallback position," and these driver-side changes are a temporary move Uber is making to treat its relationship to drivers as "business-to-business" — though it remains to be seen if that will pass muster, legally.
Meanwhile, Uber, Lyft, Postmates, and Doordash have joined in a lawsuit challenging AB-5 as unconstitutional. A separate, similar lawsuit has been filed on behalf of freelance writers in California seeking to get an exemption to the law, which only allows writers to write 35 items for a given entity per year before losing contractor status. A judge in that case refused to grant a temporary injunction to halt the law though he says he will take more time to consider the writers' objections to it.