Uber drivers in New York to strike ahead of IPO

An Uber car in New York. The firm's drivers in the city are set to go on strike this week. Reuters

Uber Technologies' drivers in New York will go on strike this week shortly before the ride-hailing company goes public to protest what they view as unfair employment conditions, a taxi union said on Friday.

The protests underscore the challenge for Uber of finding a way to lower driver costs in order to become profitable and paying drivers enough to retain their services, according to Reuters.

Drivers for Uber, as well Lyft Inc and other ride-hailing apps, will strike on Wednesday for two hours, beginning at 11.00 GMT. Uber currently expects to price its IPO on Thursday and begin trading on the New York Stock Exchange the following day.

The drivers join peers in San Francisco, Chicago, Los Angeles, San Diego, Philadelphia and Washington, DC, who are also planning to strike. The New York Taxi Workers Alliance (NYTWA) said the drivers are demanding job security, livable incomes and a cap on the amount ride-hailing companies can collect from fares.

"Uber claims that we are independent contractors even though they set our rates and control our work day," said Sonam Lama, a NYTWA member and Uber driver since 2015.

"Uber executives are getting rich off of our work. They should treat us with respect. We are striking to send a message that drivers will keep rising up," Lama said.

Uber cautioned in its IPO filing that its business would be "adversely affected" if drivers were classified as employees instead of independent contractors.

The company hopes to be valued at between $80.5 billion and $91.5bn. Uber has yet to turn a profit. It reported a net loss for the first quarter of 2019.

"I voted to go on strike because drivers need job security," said Henry Rolands, an NYTWA member and Lyft driver.

Uber did not immediately respond to requests for comment.

Lyft said its drivers' hourly earnings have increased over the past two years. "Over 75 per cent drive less than 10 hours a week to supplement their existing jobs. On average, drivers nationwide earn over $20 per hour," Lyft said.

The New York strike comes as a legal bump on the road to Uber's blockbuster initial public offering has appeared, with taxi drivers launching a class action lawsuit in Australia, according to AFP.

Thousands of cabbies are alleging that Uber gained an unfair advantage and destroyed their livelihoods by knowingly operating above the law, according to a filing lodged in the state of Victoria on Friday.

Law firm Maurice Blackburn said their clients want to recover income they claim is lost as a result of Uber allegedly operating without proper licences for their drivers and vehicles.

"It is shaping up as one of the largest class actions in Australian history," said the firm's head of class actions Andrew Watson.

"Make no mistake, this will be a landmark case regarding the alleged illegal operations of Uberin Australia."

It is unclear whether the class action will be successful, or whether any payout - even in the multiple millions of dollars - would be anything more than a blip on the company's multi-billion dollar revenues.

But supporters hope it will serve as a reminder to investors that Uber's gig economy model is likely to face more legal and regulatory scrutiny.