Now that it is a publicly traded entity, Uber is reshaping its business model. Customers can still book rides using the app, that will not change. What will change is the fund from which lawsuits are settled. As of this month, $132 million is earmarked to settle cases brought upon them by employee-contractors.
Uber has lost billions of dollars over the last three years — close to $8 billion. However, the company continues with plans to become a publicly traded IPO. While Uber owners and investors are happy about this, its drivers are not. Earlier this month, drivers across the world went on a 24-hour strike to protest low wages, the company becoming a traded entity, and their status as “contractors” instead of being valued as “employees.”.
The company is currently being sued by drivers who want more job security with the company. Feeling the ruling may be in favor of the plaintiffs, Uber is saving to pay the 60,000 drivers named in the suit. Uber has already settled a similar suit for $20 million and anticipates the current suit will be settled for an amount that falls between $146 million to $170 million upon final ruling.
Uber opened on the New York Stock Exchange at $45 per share and then plummeted in what was an unexpected shift. According to an Uber CEO who is responsible for managing the IPO, Dara Khosrowshahi, “I think we came public on a tough day, and a tough week. But this is an incredibly resilient company.” Uber’s chief competitor Lyft experienced a similar opening on the New York Stock Exchange, opening at $72 per share and closing at $52 per share.
Drivers feel they deserve to be considered employees because their job is not without risk. Employees use their own cars and insurance. Also, there are reports of drivers being held up for cash and one recent report of an Uber rider shooting another rider to death in the employee’s car. Uber also has to contend with “fake” drivers who are picking people up under guise of being an Uber driver and committing atrocious crimes. The most recent of these is University of South Carolina student Samantha Josephson, 21, who was murdered after mistaking the car she was getting into for her Uber ride.
It is uncertain as to whether or not these tragedies will make a difference in the suit by Uber employees, but they do pose a substantive risk for both drivers and riders alike.
We will keep you informed as this case progresses.
Do you have any thoughts on Uber or any of its competitor’s? Contact us for more information! Feel free to shoot us an email to Outreach@ConsiderTheConsumer.com, find us on Twitter, Facebook, Instagram, LinkedIn, or even connect with us directly on our website!
About the Author: Aisha K. Staggers is a writer, lecturer, and co-host and producer of “All Our Own” radio show and podcast and co-host of “Staggers State of Things” on the Dr. Vibe Show. Her work has been featured on MTV News, HuffPost, Blavity, Atlanta Blackstar, For Harriet, New York Review of Books and a host of other first-run publications and syndicated outlets. Find her on Twitter @AishaStaggers. For more of her work, check out her page here!
Interested in articles like these? Become a subscriber below!