It’s been an up and down week for Uber, but then again most are. When you’re so successful yet so controversial at the same time, that’s life. But two things that happened this week to the San Francisco ride-share app are far more interesting, and connected, than meets the eye.
First, let’s review Uber’s bad week. Uber had settled a lawsuit with some 300,000 drivers over pay and employee classification in April, but on Thursday a federal judge in San Francisco tossed it out, saying it was unfair to the drivers. While the company had agreed to pay out $100 million, the settlement had not been viewed positively because what drivers really want is to be considered full-fledged employees so they get better pay and some benefits.
No one was really surprised over this outcome, but it could hurt Uber’s chances of continuing to save tons of money by employing independent contractor drivers. Or it could be bad for the drivers — even if those drivers don’t last much longer.
Which brings us to Uber’s good week. It’s no secret that Uber is obsessed with driverless automobiles, and on Thursday it was revealed that the company’s first such cars will start operating in Pittsburgh this month. Of course, there will be a human monitoring the robot (which means this experiment could become 2001: A Space Odyssey in no time).
Uber is taking this tech to market way before anyone thought it was possible. And while autonomous vehicles will likely make car travel safer and more efficient, there’s no guarantee humans won’t ruin everything. Sadly, a Tesla driver died in “autopilot” mode earlier this year, although apparently it was the fault of a human driver in another vehicle. And in February, one of Google’s own autonomous vehicles was at fault in an accident for the first time ever. (Normally, it’s the other way around).
None of these potential risks seems to matter to Uber CEO Travis Kalanick, who described to USA Today how he felt like a kid again when he was taken for his first autonomous ride. As he said, “If we don’t get the [autonomous car] software thing nailed, we’re not going to be around much longer.” That’s hard to believe for a company that’s not publicly traded and is privately valued at over $60 billion. And Kalanick insists Uber is not approaching its IPO, but instead — in true techie fashion — wants to make the world safer, cleaner, and better through autonomous vehicles.
But if the driver lawsuit rejection is any indication, Uber might be forced to do something it has managed to avoid so far: classify drivers as real employees who are reimbursed for gas and vehicle maintenance, subject to workers compensation laws, and in some places qualify for other benefits like paid sick days and parental leave.
That could all be avoided, say, if autonomous vehicles really work out and human drivers are rendered obsolete. Maybe, as Bloomberg reported, that’s why Uber is spending hundreds of millions to develop driverless cars and bought driverless truck startup Otto earlier this year.
Still, Kalanick insists Uber is not out to replace humans entirely, offering this happy assessment of the future to USA Today: “This isn’t an overnight thing, it’ll take a really long time. But let’s take a city like San Francisco. Let’s say over a decade or two we go from 30,000 cars on the (Uber) system to a million. Well, there will still be routes then that software can’t do, it’ll be too hard. So you’ll need drivers in those software-equipped cars to help out. And way out, if everything’s autonomous, you’ll need tens of thousands of people to maintain a fleet of a million cars. So the jobs are there.”