Uber Settles Big Driver Exploitation Case For $20 Million

(The blog post seems to have been removed from Uber's site, but you can view a copy here, courtesy of Internet Archive.) Uber lured prospective drivers with this promise even as it cut rates in the city by 20%, a bid to make its service "cheaper than a New York City taxi". The company touted the program, which lasted from 2013 to 2015, as having the "best financing options available", but the rates were actually bad when looking at individual driver credit scores. Additionally, Uber is now prohibited from making false, misleading or unsubstantiated statements about drivers' income.

Uber claimed that drivers in San Francisco earn more than $74,000 annually, and that those in NY make more than $90,000 a year, according to the FTC's complaint, filed in a California court.

Similarly, drivers in San Francisco made around $53,000 per year, 28% less than advertised, while the company was found to have deliberately overestimated average hourly earnings of its drivers in 16 other U.S. cities.

In the FTC's complaint, the commission cites Uber's listed figures for a driver in NY and San Francisco.

"We're pleased to have reached an agreement with the FTC", an Uber spokesperson said in a statement. The FTC will now distribute the $20 million to drivers affected by Uber's reportedly bogus claims.

"Once Drivers have begun to receive their paychecks, Drivers have discovered their actual earnings were substantially less than Uber claimed", the complaint reads. "This settlement will put millions of dollars back in Uber drivers' pockets". The FTC also concluded that fewer than 10% of drivers in NY and San Francisco were earning Uber's stated rates.

However, the financing program reportedly turned out to be more expensive for drivers. The suit also alleges that Uber mislead drivers about how much financing they could expect through the company's Vehicle Solutions Program. Uber also lied about how much drivers who applied for their vehicle lease program would have to pay, resulting in applicants earning less and paying more when signing up with the company. Uber also blamed its third-party financing partners for problems on that front, and the company now handles financing itself. The drivers are considered independent contractors, which is another contentious issue because the classification excludes them from numerous benefits and protections given to full-time employees.

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