The FTC alleges that Uber claimed on its website that uberX drivers’ annual median income was more than $90,000 in New York and over $74,000 in San Francisco.
The FTC alleges, however, that drivers’ annual median income was actually $61,000 in New York and $53,000 in San Francisco. In all, less than 10 percent of all drivers in those cities earned the yearly income Uber touted.
The FTC also alleges that Uber made high hourly earnings claims in job listings, including on Craigslist, but that the typical Uber driver failed to earn those advertised hourly amounts in various cities.
The complaint also alleges that Uber claimed its Vehicle Solutions Program would provide drivers with the “best financing options available,” regardless of the driver’s credit history, and told consumers they could “own a car for as little as $20/day” ($140/week) or lease a car with “payments as low as $17 per day” ($119/week), and “starting at $119/week.”
Despite Uber’s claims, from at least late 2013 through April 2015, the median weekly purchase and lease payments exceeded $160 and $200, respectively, the FTC alleges.
Uber failed to control or monitor the terms and conditions of the auto financing agreements through its program and in fact, its drivers received worse rates on average than consumers with similar credit scores typically would obtain, according to the FTC’s complaint.
In addition, Uber claimed its drivers could receive leases with unlimited mileage through its program when in fact, the leases came with mileage limits, the FTC alleges.
Jessica Rich (Director of the FTC’s Bureau of Consumer Protection) made these comments in the News Release:
Many consumers sign up to drive for Uber, but they shouldn’t be taken for a ride about their earnings potential or the cost of financing a car through Uber.
This settlement will put millions of dollars back in Uber drivers’ pockets.
Uber’s confession is significant and hopefully will influence other companies who make fraudulent claims to potential workers
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]]>Ridesharing giant Uber raised $2.1 billion in its most recent round of funding, buoyed by a valuation of more than $65 billion – a remarkable ascendance for the five-year-old company. Its success has attracted a wave of new entrants seeking to gain a foothold in this burgeoning market. But the road to a share of the sharing economy is fraught with legal peril.
One of the new contenders is SafeHer, a by-women-for-women ridesharing company that positions itself as a secure alternative to market leaders like Uber and Lyft. SafeHer’s business model responds to growing concerns over allegations of rape and sexual violence against female passengers in Uber vehicles, and Uber’s opacity in dealing with these incidents. Uber has facedmounting criticism of its protocols for screening its drivers, whom Uber continues to classify as independent contractors instead of employees. SafeHer would staff its fleet exclusively with female drivers, and would serve only female clientele. If SafeHer’s plans come to fruition, hoteliers will be able to add value for female guests by including the service in their repertoire of concierge offerings.
Formerly known as Chariot for Women, SafeHer had announced plans to launch operations across all 50 states on April 19 of this year. But for those of us who have followed the legal tribulations of other ridesharing companies, the delay of its launch did not come as a surprise. SafeHer is not the first ridesharing company to champion a women-centered business model. But the companies that have preceded SafeHer have been thwarted by legal obstacles and threats.
Ironically, the stumbling blocks that loom largest in SafeHer’s path are federal, state and local anti-discrimination laws — laws that were passed with many of the same objectives that underlie SafeHer’s business model. SafeHer, with its goals of helping women drivers break into thehistorically male-dominated taxi industry, and providing women passengers with the same expectations of physical safety as their male counterparts, seems to be consistent with at least the spirit of anti-discrimination laws.
But whether SafeHer’s “by women for women” business plan is in keeping with the letter of these laws is a thornier question, complicated by differences in the state and local variants of civil rights statutes. A business operated exclusively “by women” risks violating the employer-related provisions of anti-discrimination laws, which generally prohibit hiring on the basis of gender. And SafeHer’s “for women” policy could run afoul of related provisions that outlaw discrimination in public accommodations.
At the federal level, the governing statute is the Civil Rights Act of 1964. Title II of the Civil Rights Act does not prevent public accommodations from discriminating on the basis of gender – this is exclusively the province of state and local government. Title VII of the Act, on the other hand,imposes strict limitations on gender-based hiring, which apply even to well-intentioned forms of discrimination.
These limitations can be overcome if an employer demonstrates that gender is a “bona fide occupational qualification,” but this exception has been applied sparingly to cases where gender bears directly on an individual’s ability to perform a job. Courts have held, most famously in the context of flight attendants, that “customer preference” for employees of a certain gender does not elevate gender to the status of a BFOQ. Several skeptics and commentators have expressed doubts about the upsot of these cases for SafeHer’s business model.
But where “customer preference” is guided by gender-specific concerns about safety and privacy, federal courts have upheld gender-based hiring practices under the BFOQ rule in a number of contexts. For instance, courts have approved of:
SafeHer’s might be able to overcome a Title VII challenge by analogizing to these precedents. Because the company’s underlying objective is to promote rather than undermine gender equality, SafeHer could find a sympathetic judge or jury willing to extend the BFOQ line of cases to its business model. The company’s troubles, however, would not end there.
Most states and major cities have enacted their own anti-discrimination laws, augmenting the protections afforded by the Civil Rights Act. This article will not attempt to summarize all of these laws and their differences, for there are too many to mention. But by way of example, New York State, Washington State, New York City, and Seattle have all enacted laws that prohibit gender-based discrimination in places of public accommodation, a subject on which federal law is silent. And while Title VII applies only to employers with 15 or more employees, the New York State andCity laws apply to employers with as few as four employees, the Washington statute applies to employers with eight or more employees, and Seattle’s ordinance applies to virtually all employers (anyone having “one or more” employees).
All four of these laws have exceptions that, like the BFOQ provisions of the Civil Rights Act, could be interpreted to permit “pro-equality” discrimination. The Washington statute expressly permits employers to implement discriminatory policies if “appropriate for the practical realization of equality of opportunity between the sexes,” and permits gender discrimination in public accommodations for the purpose of curbing “behavior or actions constituting a risk to property or other persons.” The New York State and City laws carve out exceptions for public accommodations based on “bona fide considerations of public policy.”
Each of these provisions could be construed to provide a safe harbor for businesses like SafeHer, which employ benevolent discrimination in pursuit of larger social goals of gender equality. The trouble is that there may be no way of knowing without testing these laws one by one. State and local anti-discrimination laws vary widely in their history, text and application. There is no guarantee that this patchwork of state and local laws would be applied or interpreted consistently from one jurisdiction to the next.
Against this fragmented backdrop, SafeHer’s ambition to mount a coordinated nation-wide launch might be a bridge too far for a young company backed by a single angel investor. A more modest launch, targeting a handful of states and cities with favorable anti-discrimination laws, could get SafeHer off to a stronger start, with less potential exposure, and better hopes of setting good precedent.
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]]>Lyft and larger rival Uber are attempting to resolve lawsuits by drivers who contend they should be classified as employees and therefore entitled to reimbursement for expenses, including gasoline and vehicle maintenance. Drivers currently pay those costs themselves.
A determination that these workers are employees would affect the profits and valuations at so-called on-demand technology companies.
U.S. District Judge Vince Chhabria had said the previous Lyft deal “short-changed” drivers because it represented only 9 percent of the potential value of drivers’ reimbursement claims.
In the new deal, attorneys for drivers calculated that Lyft drivers could have recovered $156 million had they been classified as employees, based on a mileage reimbursement rate set by the U.S. government and data provided by Lyft.
The $27 million settlement represents about 17 percent of that amount, which Chhabria cited as a target in rejecting the previous deal.
Uber has agreed to settle a similar lawsuit involving California and Massachusetts drivers. The potential damages in that case was $852 million, more than the $732 million in commissions Uber earned in those two states, according to court filings.
The Uber settlement, worth up to $100 million, is about 12 percent of the potential damages. A separate U.S. judge is expected to review that deal in June.
One group of drivers has objected to the Uber deal, calling it unfair. Mark Geragos, a prominent Los Angeles attorney, formally entered the case on their behalf on Wednesday.
Drivers “deserve representation by lawyers willing to fight for them and take this case to trial to uphold the basic principles of employee rights,” they wrote in a court filing.
Shannon Liss-Riordan, the attorney who has represented drivers in both the Uber and Lyft cases, has praised the settlements for providing immediate benefits to drivers. Liss-Riordan said Lyft drivers who worked a significant amount of time could receive more than $10,000 under the deal, and full-time Uber drivers could get several thousand dollars as well.
Drivers would remain independent contractors under both deals, but Liss-Riordan said the cases faced significant risks going forward and drivers could end up with nothing.
“We are proud to have reached this new agreement, which will provide significant payments to Lyft drivers who have put a lot of their time into this company,” Liss-Riordan said.
In a statement, Lyft general counsel Kristin Sverchek said the increased payment reflected the company’s growth over the past several months and maintains driver flexibility. The previous deal had been based on data from earlier last year.
A hearing on the Lyft deal is scheduled for June.
Lyft has agreed to pay $27 million to settle a class action lawsuit brought by California drivers who claimed they should be deemed employees instead of independent contractors, after a U.S. judge rejected a previous $12.25 million deal as too small.
Lyft and larger rival Uber are attempting to resolve lawsuits by drivers who contend they should be classified as employees and therefore entitled to reimbursement for expenses, including gasoline and vehicle maintenance. Drivers currently pay those costs themselves.
A determination that these workers are employees would affect the profits and valuations at so-called on-demand technology companies.
U.S. District Judge Vince Chhabria had said the previous Lyft deal “short-changed” drivers because it represented only 9 percent of the potential value of drivers’ reimbursement claims.
In the new deal, attorneys for drivers calculated that Lyft drivers could have recovered $156 million had they been classified as employees, based on a mileage reimbursement rate set by the U.S. government and data provided by Lyft.
The $27 million settlement represents about 17 percent of that amount, which Chhabria cited as a target in rejecting the previous deal.
Uber has agreed to settle a similar lawsuit involving California and Massachusetts drivers. The potential damages in that case was $852 million, more than the $732 million in commissions Uber earned in those two states, according to court filings.
The Uber settlement, worth up to $100 million, is about 12 percent of the potential damages. A separate U.S. judge is expected to review that deal in June.
One group of drivers has objected to the Uber deal, calling it unfair. Mark Geragos, a prominent Los Angeles attorney, formally entered the case on their behalf on Wednesday.
Drivers “deserve representation by lawyers willing to fight for them and take this case to trial to uphold the basic principles of employee rights,” they wrote in a court filing.
Shannon Liss-Riordan, the attorney who has represented drivers in both the Uber and Lyft cases, has praised the settlements for providing immediate benefits to drivers. Liss-Riordan said Lyft drivers who worked a significant amount of time could receive more than $10,000 under the deal, and full-time Uber drivers could get several thousand dollars as well.
Drivers would remain independent contractors under both deals, but Liss-Riordan said the cases faced significant risks going forward and drivers could end up with nothing.
“We are proud to have reached this new agreement, which will provide significant payments to Lyft drivers who have put a lot of their time into this company,” Liss-Riordan said.
In a statement, Lyft general counsel Kristin Sverchek said the increased payment reflected the company’s growth over the past several months and maintains driver flexibility. The previous deal had been based on data from earlier last year.
A hearing on the Lyft deal is scheduled for June.
Click here for the original article.
]]>For a brief summary of this uber filled case:
“You live in Gainesville and need to book a party bus, or perhaps a non-party bus or a limo to take a number of people to an event. You run a Google search for ‘Gainesville party bus’ and, not satisfied with any of the offerings on page one of the results, turn to page two. There is a listing there for ‘UberPromotions.’ Thinking that perhaps this is somehow affiliated with Uber, a nationally known taxi-like service that has recently come to town, you click on the link. You are taken to a webpage with a bright green and purple ‘über PROMOTIONS’ logo. The crux of this trademark infringement case is (roughly speaking) whether you could reasonably conclude that Uber Promotions and Uber the taxi- like service are in some way connected.”
A local Florida company, with an unfortunate name, takes on the ever expanding ride-sharing beast seeking to keep “Tech” from operating in their hometown. With “Tech’s” newer service called “UberEVENTS”, offering users to purchase a ride for others that could be used at a particular time in the future, in addition to their already explosive ride-sharing service, “Promo” is definitely feeling the heat. Pollack, of Gray Robinson, shares the details of the preliminary injunction. As far as who will be left standing, in Pollack’s own words “this case is far from done.”
Read the full article here.
]]>Most everyone, by now, has heard of Uber and Lyft. In theory, the transportation services they provide make total sense from a consumer, employee and employer standpoint. A customer takes out his or her phone, loads the app, requests a ride and within minutes he or she is in a car on the way to the destination.
There’s no doubt that the marketplace is responding favorably, as recently estimated values for Uber exceed $40 billion, while Lyft is listed at an impressive $700 million. Theory isn’t necessarily reality, however, and just like Airbnb, a few issues are still preventing both of these “ridesharing” companies from fully emerging as the preferred taxi method over traditional cabs – particularly for business travel.
How do Uber and Lyft differ?
The essential services that Uber and Lyft provide are extremely similar to each other. Once you’ve signed up with either company you can enter your credit card information so that no transaction is necessary during the course of your ride. Your card will be automatically charged after the ride is complete. When you request a ride, drivers are notified and can choose to pick you up depending on their proximity and your intended destination. A feature of both companies that is a slight advantage over regular taxis is they encourage users not to tip drivers.
Uber tends to be geared more toward professional transportation and Lyft, as Tech Times stated, gives off more of a “I’m just a friend who’s giving you a ride” feeling. Lyft drivers generally use their own personal cars – often sporting a giant pink mustache on the front.
Pricing and Service Options
Pricing is similar for both companies so for the purposes of this article we will focus on Uber. Three primary factors affect pricing:
Uber actually offers five different kinds of rides, which include the following:
Lyft offers a more limited menu of options with their standard service as described above, and Lyft Plus which provides transportation for six or more passengers. No black car service options are offered, and if you do get a black car it will probably have pink facial hair.
“IF UBER DETERMINES TRAFFIC TO BE BUSY AND RIDER DEMAND HIGH, IT WILL TACK ON WHAT IT REFERS TO AS “SURGE PRICING”, WHICH CAN FORCE RATES TO DOUBLE, TRIPLE OR IN SOME CASES SURGE EVEN MORE.”
Benefits for Business Travel
Business Insider did a side-by-side comparison between the average fares of Uber and regular taxi services in major cities. It essentially found Uber to be a cheaper ride overall, however, the element of “surge pricing” is a big factor for calculating your price. If Uber determines traffic to be busy and rider demand high, it will tack on what it refers to as “surge pricing”, which can force rates to double, triple or in some cases surge even more. Lyft has the same add-on, called “prime time,” and both companies notify users about these increased prices before they agree to a ride. However, one offer Lyft provides that Uber doesn’t is a price decrease called “Happy Hour,” which can decrease fares by 10 to 50 percent if business is slow.
Uber and Lyft can be very convenient for business travelers because their prices are simple and accommodating for companies. Uber’s Business program and Lyft’s For Work program offer services such as travel policy protections, easy administration of employees, simplified billing and expense reporting. In addition, Concur provides access to Uber through its app for booking, payment and expense reporting.
Questions with Uber and Lyft
There has been a great deal of debate about insurance procedures for both companies. When it comes to insurance policies, regular taxi companies have gone to great lengths to lash out at Uber and Lyft for their current regulations, asserting that drivers for both enterprises are sidestepping their personal insurance claims by avoiding reporting the fact they work for a ridesharing service. In fact, 45 taxi groups in the city of Philadelphiafiled a lawsuit against Uber in late 2014 because they felt the company was not correctly operating under state laws and regulations. Uber itself claims that in the event of an accident, there’s a “commercial insurance policy for ridesharing with $1 million of coverage per incident,” which provides coverage for anyone injured in the event of a mishap, “from the time a driver accepts your trip request through the app until the completion of your trip.” Lyft also provides coverage for the same amount of $1 million.
The primary issue centers on the insurance held by the drivers themselves. As Forbes reported, Uber and Lyft have historically told their drivers that their existing private insurance is all they need. However, many insurance companies feel differently and consider this type of driving to be commercial activity. Drivers have had no choice, in some cases, than to conceal the fact that they drive for Uber or Lyft from their insurance companies. This has led to some policies being cancelled when drivers are discovered, as well as allegations of insurance fraud. New laws and new hybrid personal/commercial policies aimed at drivers are currently in the works that will help to protect drivers and ensure rider safety.
Controversy and Global Concerns
Uber has come under fire for controversies with regard to several different alleged business practices, including sabotaging and recruiting Lyft drivers, proposing to expose personal secrets of critical journalists, and implementing surge pricing during emergencies such as Hurricane Sandy and the Sydney hostage crisis. In addition, Uber has had trouble spreading to all major markets – particularly globally. Germany banned Uber over licensing and France is currently investigating similar bans. The service has also been stopped in India due to a reported attack by an Uber driver. Similar charges have been filed against Uber drivers in France. UN Women, a United Nations organization focused on gender equality and empowerment, cancelled an announced partnership with Uber. All of these factors must be considered by businesses with active corporate social responsibility initiatives.
“WHILE IT STILL REMAINS TO BE SEEN HOW FUTURE LAWS COULD IMPACT POLICIES, PRICES AND SERVICE FOR RIDESHARING COMPANIES, THE VERDICT SEEMS TO BE THAT SERVICES LIKE UBER AND LYFT CAN BE A SMART OPTION FOR BUSINESS TRAVEL.”
The Bottom Line on Ridesharing Services
According to Uber, companies will save $1,000 or more per employee per year when using its Uber for Business model compared to regular taxi enterprises. Even corporate giants such as Morgan Stanley have publicly shared their endorsement of Uber by allowing its employees to use the ridesharing venture as a part of their business travel policy. Traditional taxi services are quickly adapting to this new era and many have introduced apps that mimic Uber and Lyft in an attempt to curb the loss of business.
While it still remains to be seen how future laws could impact policies, prices and service for ridesharing companies, the verdict seems to be that services like Uber and Lyft can be a smart option for business travel.
To recap, here are three important things to consider when using a ridesharing service for business travel: