Will the courts force Uber into failure to make drivers happy?
While the courts force Uber to make changes, stories like the one below are claiming the ridesharing system gets to keep its business model. That’s debatable.
The Associated Press reports,
It will cost Uber up to $100 million and took some significant policy concessions, but the ride-hailing company is forging forward with its thriving business model by keeping its drivers independent contractors, for now.
Uber settled major class-action lawsuits in California and Massachusetts that sought employee status and the rights that come with it for drivers, both sides announced Thursday night.
Under the deal, Uber will pay $84 million to the plaintiffs in California and Massachusetts and another $16 million if the company goes public and meets certain goals.
In a concession touted by the plaintiffs, Uber will allow drivers to put signs in their cars saying “tips are not included” in the price of a ride and would be appreciated. Lyft, a rival ride-hailing service, allows for riders to add a tip for the driver on the app; Uber does not.
The claim that Uber gets to keep its business model is selective reporting. Uber’s business model never included paying off disgruntled employees perhaps a hundred million dollars. By what right do the courts force Uber to pay blackmail money and advertise that their drivers take tips? A large part of Uber’s “business model” is their brand. Maybe Uber’s image will suffer with consumers and maybe it won’t, but the market should decide the issue, not the courts.
I happen to work for tips in one of my jobs and my employer tells me not to ask for them but to simply offer the correct change unless customers tell me otherwise. Uber is not the only company that is worried about its reputation when it is dealing with tips.
Lyft allows for tips on their app. How is that a rationale for forcing Uber to do the same? Lyft and Uber both have a need for happy customers and happy employees. If employees don’t like the way Uber operates, they should go work for Lyft or at some other job. If Lyft does a better job then Uber will lose business to Lyft. There is no reason for the courts to be involved. Uber is a private company. The courts should not act like they own it.
The courts are basically making business decisions that may adversely impact the company’s profitability.