It’s Wednesday morning and a small group of people are huddled in front of their phones at the foot of the giant glass skyscraper that houses Uber’s London headquarters. They are conducting an experiment in an attempt to solve one of the biggest mysteries of the platform economy right now: how Uber’s algorithm calculates drivers’ pay.
Beneath flags and signs calling on Uber to “stop dynamic pricing”, a driver requests a ride, acting as a customer, to Heathrow Airport, and receives a quote of £46. Seconds later, work rings on the phone of a fellow protester, who told the app that he’s ready to drive. Your rate? £26.
For years, Uber has charged London-based drivers a 25 percent commission. But the company told drivers in January 2023 that the app was updating its pricing model, a change it said was necessary to make rates attractive to drivers and offer the lowest pickup time for passengers. . However, people behind the wheel say those changes have reduced their salaries and made it impossible to understand how they are calculated, raising fears that dynamic pricing is offering drivers in Europe and the United States personalized salaries, an accusation Uber denies. .
“A few years ago, the fare was transparent, you could see how much the passenger was charged,” says Farah Musa, an Uber driver since 2015, who is participating in the protest and the 24-hour strike. Now that information is hidden and she doesn’t understand how the fee is calculated. “Dynamic pricing is not good for drivers. “They are deceiving us.”
Uber’s “price surge” feature used to activate only during peak periods, making rides more expensive to incentivize drivers to log into the app. Now, however, the app uses variable or “dynamic” pricing all the time, says James Farrar, the former Uber driver who won a landmark case against the company in the U.K. Supreme Court and is now a director of the organization without for-profit Worker Info Exchange. “We have gone from a completely transparent compensation and pricing system to one that is now completely opaque,” he says. “People literally don’t understand how salary has been set, how work has been assigned, and how they may have been profiled in that decision-making.”
Only Uber knows how wages are calculated, says Lucky Matthew, at the London protest, who says he now receives £400 a week less than before the pandemic. “We work the same hours as before, the cost of living is rising, but wages are falling.”
Many of the drivers at this protest have been asking their passengers how much they pay for the trip and their answers have unleashed a wave of anger towards the company because they claim that Uber is charging much more than 25 percent. “It’s a scam,” says Cristina Ioanitescu, who drives an Uber XL and carries a sign that says “smart pricing = smart traps.” “It’s a lot of stress for us.” Uber says that although commissions vary, they can sometimes be as low as 0 percent and drivers can see the rate before accepting a ride.