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Wow. This decision might upend the whole gig and sharing economy. Now every company needs to tread carefully in UK. Uber is struggling to achieve proper profita

Wow. This decision might upend the whole gig and sharing economy. Now every company needs to tread carefully in UK. Uber is struggling to achieve proper profitability even with "gig" and "sharing" economy and now this.

kahnpro 9y ago
If they’re only profitable because they are exploiting their workforce essentially evading labour laws, then good, they should be upended.
- deleted 9y ago
  [deleted]
- paul7986 9y ago
  Indeed! A workforce they are straight up using & will be kicked to the curb once they get their fleets of self driving cars on the road.
- CryptoPunk 9y ago
  No one is being exploited. People choose to work through these platforms because it's the best option available to them. You don't raise employment standards by making low standards illegal. Low paying jobs work for some people because their circumstances don't give them the opportunity to get anything better. >>It's the best option available to them because Uber's driven out the competition. Like, people choose to work at Walmart because it's the only employer in a fifty mile radius - for example. They can't work for a local store or start their own anymore because everyone's going to Walmart. We're not talking about a small town here. These are large cities with diverse economies that contain thousands of employers. Uber drivers can do other jobs besides driving. There is absolutely no evidence at all that Uber has a employer monopoly in the areas it operates, and that this is why people choose to drive for it. Anecdotally I've heard that a lot of Uber drivers are very happy about being able to drive for Uber. And by anecdotally I don't mean a survey funded by Uber. I mean from internet comments where somebody claims to know someone who drives for Uber and really likes it. Take that for what it's worth. >>Yes, in fact, we do. A whole lot of practices have ended predominantly due to legal changes The vast majority of practices ended because the market value of labour increased as a result of growth in per capita productivity. Any mandatory standard that gets ahead of the prevailing market value of low-skilled labour just creates unemployment, meaning it doesn't raise the standard of employment for the less skilled. There's no free lunch in economics. >>Allowing these jobs to undercut competitors that pay properly propagates low paid situations where society end up having to subsidize the behavior of the companies in question because they don't pay livable wages. It's exactly the opposite. A mandatory minimum wage, like any price floor, leads to unutilized supply, which in the case of labour means greater unemployment. So you're increasing welfare costs by instituting a minimum wage. The market value of labour doesn't increase because low-paying jobs were made illegal. That's not how supply and demand work.
  - porfirium 9y ago
    Who let the libertarians out?
    - CryptoPunk 9y ago
      This is too important a topic to treat with such glibness. If I'm wrong please prove me wrong, with some economic theory or data.
      - louhike 9y ago
        You make assessments with no basis and you want others to answer to you with economic theory and data? EDIT: Parent comments have been heavily edited.
        CryptoPunk 9y ago
        I at least provide reasoning for my position. It's basic economic theory that wages are set by supply and demand. Demand only increases in the aggregate from increase in productivity. Creating a mandatory price floor simply leads to less than all of the supply being consumed (which means higher unemployment). That's what price floors do. What they don't do is raise aggregate demand (meaning they don't increase total wages paid out). >>This has nothing to do with price floors. The quintessential labour standard is a minimum wage, which is a price floor. This has everything to do with price floors. In fact all labour standards can be assigned a monetary value and the combined value can be considered a price-including-benefits floor. >>you're assuming that workers have a choice regarding where to work. That is simply wrong. I don't understand. Why do you believe they don't have a choice? >>So wrong that I understood your comment was a joke. I'm certain you were trying to mock me.
        porfirium 9y ago
        This has nothing to do with price floors. In your first message, you're assuming that workers have a choice regarding where to work. That is simply wrong. So wrong that I understood your comment was a joke.
kuschku 9y ago
Ending the "gig and sharing economy" is a good thing for society. The sharing economy always was about exploiting workers (and externalizing costs), and this has created an additional cost for society. For example, DHL’s drivers are "self-employed", as result, in most countries their healthcare is funded by themselves, or by society (instead of the employer), and this means you (and your company) pay more taxes, just so that Uber, DHL, Amazon and co can save money.
- dingdingdang 9y ago
  Exactly, I am so happy that there still a good amount of "reason" within the EU block to oppose this sort of pseudo capitalism. Which in essence is just exploitation in that it feeds a tiny amount of shareholders while letting the Gov/populace pay the bill in terms of infrastructure. Same reason tax evasion by corporations should be ended since it not only devalues society but actively feeds on it while undermining the positive potential that a managed free market actually allows ALL players, not just the few that have gotten too big to fail.
- Anderkent 9y ago
  Um, what exactly is the difference between self-employed person paying their healthcare insurance, and someone being employed and the company paying their insurance? As long as the self-employed person doesn't pay tax on their insurance (which AFAIK they don't), it is exactly the same thing.
  - kuschku 9y ago
    If the self-employed person can’t afford their own insurance, but their employer doesn’t fund it for them, they often end up without insurance – and if they need to get something done anyway, society has to pick up the bill.
    - Anderkent 9y ago
      Self-employed people pay their NHS contributions the same way that companies pay for them. It's not a question of can/can't afford, it's a % of your earnings. https://www.gov.uk/self-employed-national-insurance-rates https://www.gov.uk/self-employed-national-insurance-rates
tomp 9y ago
You do realize there's no actual _sharing_ in the "sharing" economy? It's just profit-seeking by professional, if part-time, drivers, "gig" economy describes it much better.
- saas_co_de 9y ago
  you are sharing your labor with VCs ... that is about it
Kiro 9y ago
No, a lot of gig economy companies employ their people either directly or through third party. It's not problem. It's just that Uber has this fix idea of never hiring anyone. It's stupid.
vidarh 9y ago
No, just companies that tries to gain an unfair competitive advantage by avoiding laws that are there to protect workers. For any company actually following the rules it is good news that companies like Uber aren't allowed to flout them. You can argue about whether or not these regulations should be there, but as long a they are they need to apply equally across the board.
bluntfang 9y ago
>Uber is struggling to achieve proper profitability oh no, what a travesty.
Cthulhu_ 9y ago
If Uber can't make enough money to have and pay employees like all the other taxi companies have been able to for decades, they have failed as a company and need to move aside. Simple economics. Besides I doubt Uber is struggling financially, it's one of the largest companies in the world and did so by paying their drivers only a fraction of what they'd earn as regular taxi drivers. Mind you the cost for customers was similarly lower, but apparently, too low. Uber is one of those companies that lives off of investment money, using that to be able to dive under the price of their competition and putting them out of business. I'll shed no tears for them.
doctor_fact 9y ago
And without paying roughly £40m in VAT that they avoid by selling through 'non employees'.

kahnpro 9y ago

If they’re only profitable because they are exploiting their workforce essentially evading labour laws, then good, they should be upended.

deleted 9y ago
[deleted]
paul7986 9y ago
Indeed! A workforce they are straight up using & will be kicked to the curb once they get their fleets of self driving cars on the road.
CryptoPunk 9y ago
No one is being exploited. People choose to work through these platforms because it's the best option available to them. You don't raise employment standards by making low standards illegal. Low paying jobs work for some people because their circumstances don't give them the opportunity to get anything better. >>It's the best option available to them because Uber's driven out the competition. Like, people choose to work at Walmart because it's the only employer in a fifty mile radius - for example. They can't work for a local store or start their own anymore because everyone's going to Walmart. We're not talking about a small town here. These are large cities with diverse economies that contain thousands of employers. Uber drivers can do other jobs besides driving. There is absolutely no evidence at all that Uber has a employer monopoly in the areas it operates, and that this is why people choose to drive for it. Anecdotally I've heard that a lot of Uber drivers are very happy about being able to drive for Uber. And by anecdotally I don't mean a survey funded by Uber. I mean from internet comments where somebody claims to know someone who drives for Uber and really likes it. Take that for what it's worth. >>Yes, in fact, we do. A whole lot of practices have ended predominantly due to legal changes The vast majority of practices ended because the market value of labour increased as a result of growth in per capita productivity. Any mandatory standard that gets ahead of the prevailing market value of low-skilled labour just creates unemployment, meaning it doesn't raise the standard of employment for the less skilled. There's no free lunch in economics. >>Allowing these jobs to undercut competitors that pay properly propagates low paid situations where society end up having to subsidize the behavior of the companies in question because they don't pay livable wages. It's exactly the opposite. A mandatory minimum wage, like any price floor, leads to unutilized supply, which in the case of labour means greater unemployment. So you're increasing welfare costs by instituting a minimum wage. The market value of labour doesn't increase because low-paying jobs were made illegal. That's not how supply and demand work.
- porfirium 9y ago
  Who let the libertarians out?
  - CryptoPunk 9y ago
    This is too important a topic to treat with such glibness. If I'm wrong please prove me wrong, with some economic theory or data.
    - louhike 9y ago
      You make assessments with no basis and you want others to answer to you with economic theory and data? EDIT: Parent comments have been heavily edited.
      - CryptoPunk 9y ago
        I at least provide reasoning for my position. It's basic economic theory that wages are set by supply and demand. Demand only increases in the aggregate from increase in productivity. Creating a mandatory price floor simply leads to less than all of the supply being consumed (which means higher unemployment). That's what price floors do. What they don't do is raise aggregate demand (meaning they don't increase total wages paid out). >>This has nothing to do with price floors. The quintessential labour standard is a minimum wage, which is a price floor. This has everything to do with price floors. In fact all labour standards can be assigned a monetary value and the combined value can be considered a price-including-benefits floor. >>you're assuming that workers have a choice regarding where to work. That is simply wrong. I don't understand. Why do you believe they don't have a choice? >>So wrong that I understood your comment was a joke. I'm certain you were trying to mock me.
        porfirium 9y ago
        This has nothing to do with price floors. In your first message, you're assuming that workers have a choice regarding where to work. That is simply wrong. So wrong that I understood your comment was a joke.

kuschku 9y ago

Ending the "gig and sharing economy" is a good thing for society. The sharing economy always was about exploiting workers (and externalizing costs), and this has created an additional cost for society. For example, DHL’s drivers are "self-employed", as result, in most countries their healthcare is funded by themselves, or by society (instead of the employer), and this means you (and your company) pay more taxes, just so that Uber, DHL, Amazon and co can save money.

dingdingdang 9y ago
Exactly, I am so happy that there still a good amount of "reason" within the EU block to oppose this sort of pseudo capitalism. Which in essence is just exploitation in that it feeds a tiny amount of shareholders while letting the Gov/populace pay the bill in terms of infrastructure. Same reason tax evasion by corporations should be ended since it not only devalues society but actively feeds on it while undermining the positive potential that a managed free market actually allows ALL players, not just the few that have gotten too big to fail.
Anderkent 9y ago
Um, what exactly is the difference between self-employed person paying their healthcare insurance, and someone being employed and the company paying their insurance? As long as the self-employed person doesn't pay tax on their insurance (which AFAIK they don't), it is exactly the same thing.
- kuschku 9y ago
  If the self-employed person can’t afford their own insurance, but their employer doesn’t fund it for them, they often end up without insurance – and if they need to get something done anyway, society has to pick up the bill.
  - Anderkent 9y ago
    Self-employed people pay their NHS contributions the same way that companies pay for them. It's not a question of can/can't afford, it's a % of your earnings. https://www.gov.uk/self-employed-national-insurance-rates https://www.gov.uk/self-employed-national-insurance-rates

tomp 9y ago

You do realize there's no actual _sharing_ in the "sharing" economy? It's just profit-seeking by professional, if part-time, drivers, "gig" economy describes it much better.

saas_co_de 9y ago
you are sharing your labor with VCs ... that is about it

Kiro 9y ago

No, a lot of gig economy companies employ their people either directly or through third party. It's not problem. It's just that Uber has this fix idea of never hiring anyone. It's stupid.

vidarh 9y ago

No, just companies that tries to gain an unfair competitive advantage by avoiding laws that are there to protect workers. For any company actually following the rules it is good news that companies like Uber aren't allowed to flout them. You can argue about whether or not these regulations should be there, but as long a they are they need to apply equally across the board.

bluntfang 9y ago

>Uber is struggling to achieve proper profitability oh no, what a travesty.

Cthulhu_ 9y ago

If Uber can't make enough money to have and pay employees like all the other taxi companies have been able to for decades, they have failed as a company and need to move aside. Simple economics. Besides I doubt Uber is struggling financially, it's one of the largest companies in the world and did so by paying their drivers only a fraction of what they'd earn as regular taxi drivers. Mind you the cost for customers was similarly lower, but apparently, too low. Uber is one of those companies that lives off of investment money, using that to be able to dive under the price of their competition and putting them out of business. I'll shed no tears for them.

doctor_fact 9y ago

And without paying roughly £40m in VAT that they avoid by selling through 'non employees'.