Ex-Uber executives tell all, Lyft slashes budgets and Amazon suffers from an injury crisis. LegalRideshare breaks it down.
Former Uber exec spills the tea, Lyft slashes budgets, and Amazon drivers are hurting. It’s all here in Last Week in Rideshare (because LegalReader’s editor was off on Friday).
Ex-Uber executives are telling all about how drivers’ earnings were cut. TechCrunch reported:
Alissa Orlando, a former Uber executive in Kenya, said that she left the ride-hailing company in February 2017 after a period of contesting the additional price cuts, which the company’s management was actively pushing for. As the operations manager in Kenya, Orlando was in charge of launching new products across East Africa and negotiating partnerships with third-party companies like banks, amongst other duties.
In a verified affidavit that supports the drivers’ case against the ride-hailing company, Orlando said Uber planned to push down the minimum fare from the Ksh 200 (about $2 as per the 2016 exchange rate) it had settled at after a 35% price cut.
Orlando, who joined Uber in June 2016 from Rocket Internet (Jumia), weeks after the ride-hailing company instituted its first price cut in Kenya, said the plan by Uber to reduce the prices while retaining its 25% commission “was done arbitrarily and unreasonably without consulting the drivers and without due regard to the prevailing economic conditions.”
Uber seals the deal to work with taxis in Italy. Yahoo! Finance reported:
Under the agreement with IT Taxi, over 12,000 taxi drivers in Italy will have access to the Uber platform. It will make the app available in over 80 new cities and grow Uber’s existing business in big cities such as Rome, Milan, Turin and Bologna.
The partnership, which will start in June, follows similar deals in Spain, Germany, Austria, Turkey, South Korea, Hong Kong as well in New York and San Francisco. The company wants to have every taxi available on its app by 2025.
Lyft joins Uber in cutting back budgets. Business Insider reported:
Lyft will be scaling back on hiring and reducing budgets amid concerns of an economic slowdown, but it’s stopping short of firing workers, the Wall Street Journal reported on Tuesday. The rideshare startup joins a growing list of tech companies that are finding it more challenging to be profitable.
“Given the slower than expected recovery and need to accelerate leverage in the business, we’ve made the difficult but important decision to significantly slow hiring in the US,” Lyft President John Zimmer wrote in an internal memo shared on Tuesday, according to the Journal.
This means that the company will leave some roles open and only fill those critical to the business, the Journal said. It will also reprioritize projects to focus on those that can have the most immediate impact.
Amazon is currently suffering from an “escalating injury crisis”. CNBC reported:
Nearly one in five drivers making deliveries for Amazon suffered injuries in 2021, a 40% increase from last year’s injury rate, the Strategic Organizing Center said in a report released Tuesday.
The SOC, which is a coalition of labor unions including the International Brotherhood of Teamsters and the Service Employees International Union, analyzed data submitted by Amazon and its delivery partners to the Occupational Safety and Health Administration in 2021.
The SOC report found that contracted Amazon delivery drivers suffer injuries at nearly two-and-a-half times the rate of the non-Amazon delivery industry. It also found that, in 2021, one in seven Amazon drivers sustained injuries that were so severe that they either cannot perform their regular job, or are forced to miss work altogether, the report states.
Uber & Lyft are getting criticized over their strategy to “gamify” the gig economy. Bloomberg added:
For more than a decade now, gig economy companies have told workers that signing up for ride-share or delivery side hustles will allow them to be their own boss, to choose how and when to work in a way that fits their lifestyles. Instead, workers have found themselves managed by incentives and code. Sophisticated software holds real-time auctions every second, matching prospective customers with drivers or couriers in a vast marketplace.
To many drivers, the flexibility of their contractor status is indeed a benefit, but many also describe an experience plagued by uncertainty and arbitrariness. The business model they participate in depends on an asymmetry of power and information: Typically, for example, they have to decide whether to accept a ride without knowing where the pickup or drop-off will be. Unable to assess how much money a trip will bring in, they’re at a disadvantage in the great labor-bidding scrum.