Drivers accused of gaming the system to create artificial surge prices

ABC NEWS (Australia)

Uber drivers, hoping to make more money, have admitted they are manipulating the system to push prices up meaning some passengers could be paying up to three times the cost of their trip. Drivers say they are forced to be innovative, because the rideshare company doesn't pay enough and is taking a bigger cut.

Transcript

00:00Look, this is a revelation that really demonstrates, yet again, that the gloss has really come

00:07off the Uber model. It's worth, before I deal with that, Joe, just looking a little

00:11bit back in history. Uber came into the country in 2012. Governments rolled out the red carpets

00:16to them. They decimated the taxi industry. We were all a little bit blinded by the snappy

00:21new app. And of course, before too long, we realised that we were getting pinged as customers

00:28with surge pricing algorithms. And we've all been there on a Saturday night and paid through

00:35our nose for an Uber ride. No reason for that other than Uber knows that it's a busy night

00:41and they can maximise profits. And the problem is that consumers are getting pinged by the

00:46Uber model, but drivers are as well. Drivers now, we know from a large survey last year,

00:5350 per cent of them being paid below the minimum wage. These are drivers that are treated as

00:58independent contractors. They've got to pay for their car, for their fuel, for their insurances.

01:03They don't get leave entitlements. And they're being worked to the bone. So it's important

01:09that that context is put before the Australian community. If there's anyone that should be

01:13in the gun sites here, it's Uber and the Uber model, which is exploiting consumers and exploiting

01:19drivers, Joe. Yeah, so you've put that in context there. How often does it happen and in what

01:24situations? Well, the reports we've had, the revelations

01:27we've had relate to confined circumstances at airports. And these drivers are doing what

01:34they can to look after themselves and their families. This is obviously not conduct that's

01:40to be condoned, but it's conduct that's entirely explainable in the context of these workers being

01:46underpaid, even the minimum wage in our country. You know, we've become accustomed to the convenience

01:51of Uber, Joe, we all have. And these workers, for example, in COVID were still taking us from

01:58A to B, putting themselves literally on the line before we had a vaccine. So they are some

02:03of the heroes of the pandemic. They are workers who are valuable in our society, but they're

02:08workers that are completely undervalued by an Uber system, an essential monopoly, where

02:13Uber can just slash their rates and they do regularly. And these drivers have no recourse.

02:18Now, last year, Joe, the ALP government put in place a new set of standard setting apparatus

02:25in the Fair Work Commission. And we're in the process of working through with rideshare workers

02:29right now, triggering those new laws to ensure that companies like Uber have to pay a fair

02:35wage to these workers to make sure that they can look after themselves and their families.

02:40So we're on the cusp of change in this industry. And in the meantime, of course, these revelations

02:45are unwelcome. But they are important because they shine a light on what is an exploitative

02:50system for drivers and for consumers.

02:52Yeah. So you say it's happening for a valid reason. But what about the fact that passengers

02:56are effectively getting ripped off in the process?

02:59Well, everyone's being ripped off by the Uber model. If you are out, as I said, on a Saturday

03:05night, you are paying through the nose for no good reason. This is not a normal contract

03:10where you have supply and demand in play. This is just if it's a busy Saturday night, Uber

03:15knows that it can get more money from a consumer. So it jacks up the prices. And that is unhelpful.

03:21It's not what we expect. We're all being taken for a ride, but not the ride we expect, Joe.

03:27It's time for the Uber model to be held to account. And we'll be working with rideshare workers

03:32over the course of the coming months to action these new laws that the Albanese government

03:37put in place to set standards for these workers so they can make a reasonable living for themselves

03:41and their families.

03:42And can you set out for us what a driver would get out of a $20 fare? Just so viewers understand

03:48what's happening. What cut does Uber take?

03:51Well, this is the other problem. Uber's processes are completely opaque. Drivers at their work day

03:58are completely controlled by Uber. Their pay is controlled by Uber. They don't know what

04:03they're going to receive as pay before they take a job. It just ends up in their pay packet

04:08and it's not very much. It's the same situation for consumers. You never know when you hop in

04:13an Uber whether it's going to cost you $10 bucks or $30 bucks. And this is an opaque system.

04:19It's a long time that we reach as a community some type of reform for it. And this unwelcome

04:24news is useful because it shines a light on this exploitative model.

04:28We've got to get it right for the community. We rely on these services. These workers are

04:32doing good stuff for the community. We've got to make sure that they're taken care of

04:35as well.

04:36You said people getting in a cab don't know if they're going to pay $10 bucks or $30 bucks.

04:40The beauty of Uber initially at least was that you would get the fare, and that was better

04:45than a taxi, whereas you could book it and you've paid for it for $15 bucks or whatever

04:50before you get in.

04:51Oh yeah, you know what you're going to pay before you get in. But at any given time, you don't

04:56know whether a trip from the same A to B is going to cost you $10 or $30. And this is

05:02because we've got opaque surge pricing. Uber controls that through algorithms. That's

05:07unfair for the consumer, and it's certainly unfair for the driver who faces unilateral

05:12pay cuts month after month and who can't get enough simply to look after themselves and

05:17their family because they're being paid below the minimum wage. So it's in a high time that

05:22change was made. And it's moments like this that we have to shine a light to make sure

05:26that we get that change in this Uber system.

05:28Yeah, and you've already gone through this a little bit, but just take us through how

05:33you hope to address this. What specific way through the legislation do you hope that drivers

05:39will get a fair cut?

05:41Well, last year the Fair Work Commission was empowered to set standards for gig workers.

05:47And we're in the process of crafting an application with rideshare workers to make sure they get

05:52a minimum wage, to make sure that they've got access to workers' compensation, to make

05:56sure they've got access to superannuation. Those things that other workers in the Australian

06:00community take for granted. And to make sure, Joe, and this is the horrific thing, horrific

06:06revelation for today, to make sure that these workers receive at least the minimum wage.

06:12It's not too much to ask, and we need to make sure that that occurs. So over the coming months,

06:17we'll be making an application to the Fair Work Commission to ensure just that, so these

06:22workers can have a reasonable livelihood for themselves and their families.

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