Uber looks to Australia after Californian employment victory

Uber chief executive Dara Khosrowshahi: ‘There is no need to perpetuate the inflexible, old-fashioned binary legal definition of employees or independent contractors.’ Picture: AFP
Uber chief executive Dara Khosrowshahi: ‘There is no need to perpetuate the inflexible, old-fashioned binary legal definition of employees or independent contractors.’ Picture: AF

Fresh from a bruising, multi-million-dollar Proposition 22 victory in California, Uber chief executive Dara Khosrowshahi, who is now three years into the top job, is broadening his horizons.

Uber, along with fellow US delivery giants Lyft, DoorDash, Instacart and Postmates, claimed a major victory on election day this month when California voters overwhelmingly approved Proposition 22, a ballot measure to exempt gig economy companies from classifying their workers as employees.

The company spent millions of dollars on ad campaigns and lobbying and is now wanting to replicate that success elsewhere, including in Australia.

“Hopefully it won’t be a fight,” Mr Khosrowshahi said. “It’ll be a dialogue.

“Our idea is that flexibility shouldn’t come at the sacrifice of protections as it relates to workers. We think that’s just genuinely a good idea, and what Prop 22 showed is that drivers want flexibility, as well as earnings and protections.

“This was not a close election. It was a very clear one. And what we’re hoping is that we can take that message and that idea, that drivers, couriers and other independent workers should have flexibility, as well as healthcare protections, accident protections and insurance protections.”

READ MORE:Uber, delivery firms win Californian vote

Mr Khosrowshahi has an unexpected ally in Transport Workers Union national secretary Michael Kaine — they agree the California government’s approach to treating Uber drivers as employees was wrong. Where the two disagree is on the mechanisms to enforce workers’ rights.

“There is no need to perpetuate the inflexible, old-fashioned binary legal definition of employees or independent contractors. There is no need to do that,” Mr Kaine said.

“We’ve shown for over five decades in NSW that you can have an independent tribunal that reinforces certain work as an independent contractor, but nevertheless acknowledges there’s a level of dependency that requires and deserves some protections. You need to put a body in place that has the power to act, and get the balance right.”

California voters overwhelmingly approved Proposition 22, a ballot measure to exempt gig economy companies from classifying their workers as employees. Picture: AFP
California voters overwhelmingly approved Proposition 22, a ballot measure to exempt gig economy companies from classifying their workers as employees. Picture: AFP

In July last year the Fair Work Ombudsman completed an investigation into Uber and found its drivers to be independent contractors, not employees, because they have control over their hours.

As far as the TWU and some drivers are concerned, however, the matter isn’t settled, and the issue has been pushed into the spotlight after recent driver fatalities.

Calls to further regulate Uber and other delivery services have reached fever pitch after five deaths in just two months.

The NSW government announced a probe into the so-called gig economy, though both Labor and the Greens have called for “emergency regulation”.

Uber says it is working on several initiatives including driver and courier training, annual safety tests and fatigue management features. The company has faced criticism for not providing its drivers with adequate safety equipment, and has not revealed how much compensation is owed to families of the deceased workers.

Visiting Australia virtually to meet with employees and drivers, Mr Khosrowshahi described Australia as a “model market” for Uber, and said the company’s mobility business had recovered to about 70 per cent of pre-COVID levels, and Uber Eats was growing faster than it ever had.

He also confirmed the company was bringing its subscription product — Uber Pass — to Australia, meaning the tech giant will join the likes of Netflix and Spotify in vying for a share of monthly subscription dollars. The offer will include perks such as 10 per cent off rides and free delivery.

“Australia is usually one of the early markets in which we test our products, and subscriptions are going to be a big part of our business, which means it’s going to be a big part of our business in Australia, as well as around the world,” he said. “The promise of Uber is to really be that ‘next hour’ company.”