Uber gave drivers more control to prove they’re independent. Now the company is taking back control because drivers actually used it.

GettyImages 1176816141 (1) NEW YORK, NEW YORK - SEPTEMBER 24: Dara Khosrowshahi, CEO, UBER, speaks onstage during the 2019 Concordia Annual Summit - Day 2 at Grand Hyatt New York on September 24, 2019 in New York City. (Photo by Riccardo Savi/Getty Images for Concordia Summit)
Uber CEO Dara Khosrowshahi.

  • Uber is revoking California drivers’ ability to set prices and see trip destinations in advance, the San Francisco Chronicle reported.
  • Uber gave drivers more control in 2020 to avoid reclassifying drivers as employees under AB-5.
  • But it reversed course after Prop 22 exempted it from AB-5, saying drivers turned down too many rides.
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In late 2019, California lawmakers passed AB-5, hoping to make it harder for companies like Uber to skirt labor laws and offload healthcare and unemployment insurance costs to taxpayers by misclassifying workers as contractors.

But Uber refused to comply, arguing that AB-5 didn’t apply to its drivers because they aren’t core to its business and that drivers really are independent because they’re “free from the control and direction” of Uber.

In an attempt to prove its independence argument, in January 2020, Uber gave California drivers more control by allowing them to set their own prices for rides and see passengers’ destinations before picking them up.

Regulators and courts didn’t buy it. But fortunately for Uber, a $200 million PR campaign around Proposition 22 successfully persuaded California voters to exempt it from AB-5, saving the company as much as $500 million per year, according to a 2019 estimate by Barclays analysts.

Now that Uber no longer needs to convince California authorities that its drivers are independent, the company plans to reclaim control, revoking the price-setting and passenger destination features it gave drivers barely a year ago, the San Francisco Chronicle reported Monday.

Uber’s reason for the reversal?

Too many drivers took advantage of the control Uber gave them, picking the most profitable rides while declining others, making it harder for customers to get rides and hurting Uber’s business, the company said. According to the Chronicle, one-third of drivers turned down 80% of rides.

Industry observers said the move is hardly surprising but it undermines Uber’s claim that the changes were ever about anything more than dodging regulation.

Uber did not respond to a request for comment on this story.

“It really shouldn’t be a shock to anyone,” Harry Campbell, who runs The Rideshare Guy, a popular blog among drivers, told Insider. “Since they passed Prop 22… there’s nothing holding them accountable for these changes.”

Campbell said that drivers likely won’t be happy given the popularity of the price-setting and passenger destination features, but added, “It’s kind of, unfortunately, a bit of a pattern that Uber specifically often gives drivers some things that they want and then ends up taking them away.”

“Is there a single Prop 22 promise that Uber hasn’t broken?’ Gig Workers Rising, which advocates on behalf of ride-hailing and food delivery drivers, tweeted in response to the Chronicle’s reporting, alluding to Uber’s history of misleading claims during its Prop 22 campaign.

But by revoking some driver-friendly features, Uber – which has yet to turn a profit – also revealed some of its post-pandemic priorities.

Companies like Uber and Lyft rely on flooding the market with drivers, who then face pressure to accept lower-paying rides and risk another driver getting the job or getting penalized themselves for turning down too many rides, even if those rides are unprofitable.

But during the pandemic, there has been a massive shortage of Uber and Lyft drivers, due to a drop in demand for rides and a concern among drivers about getting sick (the companies don’t provide healthcare or sick pay). And even as rider demand returns, many drivers are still staying home.

With fewer drivers on the road and Uber drivers able to freely reject unprofitable rides, they’re driving up their wages. That means higher prices and longer wait times for passengers, which Uber isn’t happy about.

“The companies, strangely, they care more about reliability than profitability at this moment in time,” Campbell said. “They want to make sure that the platform is working like everyone expects and if drivers are ignoring 80% of requests, that means that it literally is going to take longer for you to get matched with a driver.”

Campbell said Uber, Lyft, DoorDash, and other platforms are offering huge incentives to drivers – like a $250 bonus for completing 20 rides – as they struggle to get them back on the road.

As with past promises, those incentives and other driver-friendly features could just as easily disappear if the market becomes saturated with drivers again and companies regain the upper hand, but Campbell said that there needs to be a middle ground.

“If Uber is going to be able to get away with paying drivers like independent contractors, I think that’s kind of some of the control that they have to give up and find a way to make work.”

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Egypt’s president orders preparations be made to unload Ever Given’s cargo if refloating fails, a high risk strategy adding days of delay

suez canal ever given cargo
A handout picture released by the Suez Canal Authority on March 25, 2021 shows an Egyptian tug boat equiped with a rope trying to free Taiwan-owned cargo MV Ever Given.

  • Egypt’s President has ordered preparations be made to unload the cargo of the Ever Given ship.
  • He outlined the plans to the Suez Canal Authority on Sunday morning, local media reported.
  • Unloading the cargo risks unbalancing and damaging the ship, an expert warned.
  • See more stories on Insider’s business page.

Egypt’s president has ordered preparations be made to unload the cargo of the Ever Given ship if refloating fails, according to local media reports.

President Abdel Fattah Al-Sisi outlined the plan to the Suez Canal Authority on Sunday morning, Daily News Egypt reported.

Efforts are currently underway to refloat the ship. The floatation efforts included towing and pushing the grounding vessel using 8 large tugboats, the Suez Canal Authority said.

Authorities are also working to dig the Ever Given out of the sand, The Wall Street Journal reported. Dredgers have shifted 27,000 cubic meters of sand to a depth of 18 meters, Arab News said.

But plans are in place to unload the cargo of the massive ship if these efforts fail, CGTN Africa reported.

Helicopters would most likely need to be used to lighten the Ever Given’s load, The Wall Street Journal reported. This is because there are no cranes in the vicinity that are tall enough to reach the top of the stacked containers, the paper said.

The process could unbalance and damage the ship, BBC News reported. “Worst case scenario is that she breaks in half because of [uneven] weight distributions,” Sal Mercogliano, an expert in maritime history, told the BBC.

It is likely that an effort to remove cargo boxes from the ship would take several days, Bloomberg reported. The Ever Given carries a load of 20,000 containers.

The Ever Given ship has caused a blockage in the Suez Canal since Tuesday morning.

The incident is costing the global economy billions and has caused hundreds of vessels to become stranded.

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Egyptian authorities say ‘human error’ may be to blame for the Suez Canal Ever Given crash after initially attributing it to strong wind

ever given ship jam suez
MARCH 26, 2021: Maxar’s WorldView-2 collected new high-resolution satellite imagery of the Suez canal and the container ship (EVER GIVEN) that remains stuck in the canal north of the city of Suez, Egypt.

  • Officials initially blamed the giant Ever Given container ship running aground on weather conditions.
  • The Suez Canal Authority chief initially said “strong winds and a dust storm” had caused the blockage.
  • He has now raised the possibility of “technical or human error” as being to blame.
  • See more stories on Insider’s business page.

Egyptian authorities suggest the Ever Given ship running aground on Tuesday morning could be due to “human error,” according to MailOnline.

It is a revision of initial claims that blamed environmental factors for the epic Suez Canal jam. Officials initially said that the 1,300-foot-long cargo ship became stuck due to troublesome weather conditions.

Read more: When America’s busiest port is log-jammed, the US economy suffers – but these 22 companies thrive

Lieutenant-General Osama Rabie, chair of the Suez Canal Authority (SCA), said on Tuesday that it probably happened due to “strong winds and a dust storm that obstructed the view,” according to the Egyptian newspaper Al-Masry Al-Youm.

But Rabie has since gone back on this assessment. “Strong winds and weather factors were not the main reason,” the SCA chief said on Saturday.

The incident that prompted a global trade blockage may have been caused by “technical or human errors,” he said, the MailOnline reported.

Moments before it ran aground, the Ever Given was apparently traveling faster than a speed limit set by the Suez Canal Authority, Bloomberg reported.

The Ever Given’s last recorded speed was 13.5 knots, logged 12 minutes before it grounded, according to Bloomberg, which cited its own data. The maximum allowed speed through the canal was between 7.6 knots and 8.6 knots, the report said.

The Japan Times also reported the ship was traveling 13.5 knots, adding that two canal pilots were on board when the ship hit land.

The Ever Given didn’t have a tugboat escort through the canal, according to Bloomberg. The two ships immediately ahead of it reportedly had escorts, although such escorts were not required.

One ship captain unaffiliated with the grounding spoke with Bloomberg. Chris Cillard, the captain, told the outlet ships sometimes speed up to better control their vessels during wind storms. “Speeding up to a certain point is effective,” he said.

The massive container ship is still wedged in the Suez Canal, over five days since it first became lodged.

Workers have made a “significant process” in freeing up the canal and have managed to release the ship’s rudder from the sediment, Insider’s Michelle Mark reported.

The Ever Given’s Suez Canal blockage costs an estimated $400 million per hour, Insider’s Kelsey Vlamis reported.

Rabie said during a Saturday press conference that he couldn’t speculate on when the ship will be re-floated.

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