Uber admits to underpaying NYC drivers as Hong Kong arrests 21 drivers

Tens of millions of dollars in backpay are owed to Uber drivers in New York, Hong Kong is cracking down on the service, and one Australian state is softening its laws on the ride-hailing service.
Written by Chris Duckett, Contributor

(Image: James Martin/CNET)

Uber has admitted to underpaying its New York City drivers tens of millions of dollars for the past two and a half years.

"We are committed to paying every driver every penny they are owed -- plus interest -- as quickly as possible," Uber executive Rachel Holt said in a statement.

"We are working hard to regain driver trust, and that means being transparent, sticking to our word, and making the Uber experience better from end to end."

The ride-sharing company said each affected driver would get a refund of about $900. Uber did not give an exact figure on how many drivers it has in the city, but said it was in the tens of thousands.

The company said it had mistakenly continued to calculate its commission based on the gross fare before any taxes and fees were deducted. It will now calculate its commission based on the net fare, which is in line with its updated national driver policy enacted in November 2014.

The union that represents Uber drivers, the New York Taxi Workers Alliance, welcomed the announcement but said the company owes its drivers more than it is claiming.

"This payout is an attempt by Uber to pull a fast one to avoid court oversight and short-change drivers in the process," executive director Bhairavi Desai said.

Uber also found itself in hot water in New York at the start of the year when it continued to service John F Kennedy airport in the midst of an hour-long taxi union strike to protest President Trump's executive order on immigration.

In response, users began to quit Uber, with many saying they would no longer use the service they accused of being scab labour.

In an effort to hose down the social media storm, the company, which is known to operate outside the law when it suits it, said it would pay any of its drivers affected by Trump's immigration ban for three months, and then highlighted its ties to the Trump administration.

"That means this ban will impact many innocent people -- an issue that I will raise this coming Friday when I go to Washington for President Trump's first business advisory group meeting," Uber CEO and co-founder Travis Kalanick said on January 28.

By the end of the week, though, Kalanick was backtracking and removed himself from the Trump administration's advisory panel, saying his presence was "misinterpreted".

Meanwhile, in Hong Kong, police have arrested 21 Uber drivers for illegal car hiring as part of an ongoing clamp down against Uber in the Asian financial city.

The arrests on Tuesday mark the latest upset for the company, which in March said it would help five convicted Uber drivers to appeal their court case.

Police say they began an undercover operation in May, and on Tuesday arrested 20 men and one woman between the ages of 21 to 59 for illegally driving a car for hire and driving without third-party risk insurance.

"I would like to stress that our law-enforcement action is ongoing and we do not rule out further arrests," said Lau Tat-fai, chief inspector of Police Enforcement and Control Decision at the Kowloon West district.

"We would like to say to the operator of the mobile phone application, as a responsible organisation, you need to ensure cars for hire are equipped with a permit as required by Hong Kong laws. This is a basic responsibility to passengers and [shows] respect for Hong Kong laws," Lau said.

He said those who assist or instigate drivers might also have to bear legal responsibility.

Uber was not immediately available for comment.

A local court in March had found five Uber drivers guilty and fined them HK$10,000 each. It also revoked their driving licences for a year, but that punishment was suspended upon the drivers' appeal.

Uber began a fierce publicity campaign following the verdict, splashing ads on newspaper front pages and giving out plane tickets and Manchester United football jerseys to a few random passengers.

The embattled technology company pulled out of Taiwan earlier this year over mounting fines from regulators, but said last month that it would resume services.

Earlier this week, Uber admitted to using artificial intelligence to charge customers based on what they are likely to be willing to pay.

The system is activated in 14 cities, but does not guarantee drivers see any part of the inflated fares.

The company's systems have drawn criticism in the past, one of the most notorious cases being dubbed Greyball, which allowed the service to avoid the authorities.

Predominantly used in the US, Greyball first came to light when investigators began to hail rides using the Uber app to build a case against the company. One investigator found his ride requests were swiftly cancelled after being submitted.

In May, the US Department of Justice launched a criminal investigation into the Greyball program.

Uber's time with federal authorities is not restricted to Greyball, with a stoush between Google spin-off Waymo and Uber being referred to federal prosecutors.

Google is accusing Uber of accessing and using self-driving technology developed by former Waymo employee Anthony Levandowski, after he allegedly stole 14,000 files to begin his own business. Levandowski's company was eventually bought out by Uber, and he became the head of Uber's self-driving car unit. Levandowski stepped aside from his role at Uber in April.

In a change of fortune for the company, there is positive news out of Queensland, where the government will introduce legislation on Wednesday to reform the operations of ride-sharing services.

A parliamentary committee earlier this month made 16 recommendations for the new legislation, including that ride-sharing services won't need cameras installed, with that measure to be reviewed after 18 months of the new laws taking effect.

Taxi Council Queensland slammed the move as a "cop-out", but Uber supported it because it would keep costs down for its drivers.

Other recommendations included rules stopping drivers from doing a shift in a taxi and then an Uber, as well as a register of blacklisted drivers.

The introduction of the legislation is the beginning of the end of a process which began with the legalisation of Uber and similar ride-sharing services in August last year.

Legalisation of Uber in Queensland represented a turn-around after a ban was passed earlier that year in April, which not only banned Uber, but also inadvertently made charter bus services, tourist services, chartered school bus services, community transport services, limousine services, shuttle services, and hotel accommodation transfer services illegal if not operated by a licensed taxi.

Not content with limiting itself to cars, last week Uber moved into trucking with Uber Freight.

The company said the majority of the freight in its app is based around Texas, and claimed 100 percent of the loads on the service were exclusive to it thanks to contracts with shippers.

Uber also has plans to tackle the skies, with the company planning an air taxi by 2020.

Airbus, which is also planning on having an autonomous air taxi by 2020, said earlier this month that the technology needed for such a task is not available yet.

According to Arne Stoschek, head of autonomous systems at Airbus A3, the computing challenge is a result of the operating environment the vehicle will face. Compared to the autonomous cars, air vehicles will face many of the same issues at or near the ground, but it is when cruising altitude is reached that unique problems appear in 3D space, and without a traditional breaking mechanism.

"If we have an obstacle 500 metres away ... that's 10 seconds to impact. If we have something that is [approaching] with our own speed, closing speed of 100 metres per second, then we have five seconds to impact, which is not a lot of time," he said.

"So we need to be both very accurate, and very fast."

To handle the sheer amount of data, Airbus will need an order of magnitude increase in CPU performance, memory, power usage, as well as improvements in software and hardware, but Stoschek said the company remains confident it will be ready by 2020.

With AAP

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