Ride-hailing drivers across the world went on strike on Wednesday, ahead of Uber Technologies Inc.’s UBER, +0.00% massive initial public offering, which is expected to price on Thursday.
The drivers are protesting the large payouts that will go to Uber’s founders, executives, and investors once the IPO is completed, arguing that the company’s top leaders will become very rich while benefiting from a business model that exploits workers. The company itself could raise up to $9 billion through its offering, which would value Uber at upwards of $83 billion at the high end of its expected pricing range of $44 to $50 a share.
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The Independent Workers Union of Great Britain, which counts British drivers as members, encouraged consumers “not to cross the digital picket line” by booking Uber rides during the strike, which started at 9:00 a.m. local time and continued until 4:00 p.m. The union is demanding an increase in wages and a drop in the commissions that Uber takes after every ride.
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Strike actions and protests were also planned in cities around the U.S., including New York, Chicago and San Francisco. There were overnight strikes in Australia in Sydney and Melbourne, according to media reports.
For this gig-economy walkout, however, participation numbers proved challenging. Some of the independent contractors in major cities were still providing rides to users on the app. It wasn’t clear at this point in the day how many drivers took part in the global strike, although the U.K. union official estimated participation in the thousands.
“Uber is exploiting all of the drivers on its platform,” London driver Muhumed Ali told MarketWatch. “Some drivers are working for pennies, it’s a very low wage and our costs are high.
“You have to have an expensive car, you pay insurance, you pay fuel and nowadays, you have to pay a 24 pounds ($31)-a-day congestion charge,” he said, referring to the fee introduced by London Mayor Sadiq Khan in April as part of a push for cleaner air.
“Uber is not willing to compensate us for that cost, or allow us to pass it on to the customer,” said Ali, who has been an Uber driver for four years.
Drivers are pushing to increase fares to £2 a mile and for Uber to reduce its commission to 15% of a fare from 25%. If the company does not comply, the drivers will continue their action, said Ali.
The strike drew the attention of public figures, including Democratic presidential candidate Sen. Bernie Sanders, who has crusaded against the power of big tech companies.
Tomorrow, join me in standing with Uber and Lyft drivers. Uber is a multibillion-dollar company. Its top five executives made $143 million last year. Their drivers should not be getting pay cuts—they deserve a living wage and decent benefits. https://t.co/JM1rAo0L8t
— Bernie Sanders (@BernieSanders) May 8, 2019
Jeremy Corbyn, who leads the Labour Party in the U.K., chimed in as well on Twitter.
Uber cannot be allowed to get away with huge payouts for their CEOs while refusing to pay drivers a decent wage and respect their rights at work. Stand with these workers on strike today, across the UK and the world, asking you not to use Uber between 7am and 4pm. #UberShutDown
— Jeremy Corbyn (@jeremycorbyn) May 8, 2019
Drivers detailed their experience with Uber’s commissions, while customers voiced their support. Uber, like many other gig-economy companies, categorizes its drivers as independent contractors, which reduces the company’s obligations to give the workers benefits.
Uber and Lyft have both said in their IPO documents that worker status is key for their business models. Both companies have massive operating losses. Drivers in London have already successfully challenged their status in court and an employment tribunal found that they should be classified as workers with the right to a minimum wage and paid holidays. Uber has appealed and vowed to take its case to the U.K. supreme court.
Researchers at the Economic Policy Institute found that Uber drivers earn an hourly wage of $9.21 on average, after deducting things like fees and commissions. That wage lands below the hourly minimum wage in most of Uber’s major markets, the researchers concluded.
As an Uber driver Whatever I earn I get only 50% of it. Uber takes 25% commissions and Government takes 25% Tax. #Uber should reduce commission charge. I work 75hrs a week in order to earn a living #UberShutDown
— Hanif Y (@yakowlangi) May 8, 2019
It’s cold, wet and rainy. I’m exhausted I’m on my way to the hospital. Would usually get an Uber but today I’m leaving a bit earlier to get a bus. #Solidarity #UberShutDown https://t.co/GcmKVeGD2l
— Chardine TaylorStone (@misschazmatazz) May 8, 2019
Good luck to the Uber and Lyft drivers striking today. My mom’s husband drives so they can have a little piece of something, and it’s cray how little something they get from those rides. Without those folks using their OWN cars and time, the tech companies would be nada.
— Danez Smith (@Danez_Smif) May 8, 2019
And I don’t know where a touring poet would literally be without their service. I’ve met so many dope people (and only a few creeps) using these services and I hope that all the moms and uncles and grandmas that have let me ride in the back of their whips get PAID. PROPERLY.
— Danez Smith (@Danez_Smif) May 8, 2019
The strike comes a day after Uber’s rival Lyft Inc. LYFT, -6.53% posted another quarter of steep losses in its first earnings report since holding its own IPO in late March.
Lyft shares were down 6.5% Wednesday, while the Dow Jones Industrial Average DJIA, +0.33% and S&P 500 SPX, +0.27% were up 0.1%.
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