Is Uber about to let its drivers set their own fares for rides?
Something like that could be possible, following reports that Uber has begun a testing program to allow some drivers to raise their ride rates above those initially set by the ride-hailing giant. Currently, the test is limited to drivers in Sacramento, Santa Barbara and Palm Springs, and only for rides from those cities’ airports.
As part of the fare-test program, drivers will be able to raise their fares in increments of 10%, up to five times Uber’s initial ride price. When a rider makes a request for a location in the test program, Uber will match that rider with the lowest fare that has been set. It is not known if Uber will expand the pilot program to other markets.
The testing program comes amid an ongoing brouhaha between Uber and other gig economy companies, and the state of California over the recently passed AB 5 law. That law says companies have to classify workers as employees instead of independent contractors if those workers’ services provide a substantial contribution to a company’s main source of business. Under AB 5, Uber, for example, would be required to make its drivers eligible for benefits such as paid time off and health insurance.
“Since AB 5 has gone into effect, we’ve made a number of product changes to preserve flexible work for tens of thousands of California drivers,” an Uber spokesperson said. “We’re now doing an initial test of additional changes which would give drivers more control over the rates they charge riders.”
Uber has maintained that its drivers work independently from the company on the grounds that it provides a technological platform for linking riders with drivers, and is not a transportaion company in the true sense of the term. Uber, along with food delivery company Postmates and two individuals, has filed suit against AB 5, and is seeking injunctions to block the law from going into full effect, Uber and Postmates, along with ride-sharer Lyft and food-delivery company DoorDash have also put more than $100 million into an effort to get the AB 5 issue in front of California voters on the November 2020 ballot.