VANCOUVER—In 2013, Nicole Moore had a family, what she describes as one of those “infamous” mortgages.
The payment on her California home had ballooned to three times its initial size after America’s financial crisis in the U.S. A middle-income job in health care simply wasn’t enough to make ends meet anymore.
She was left with few options.
But she had a car, and so she started to drive for a ride-hailing app on the side. At first, it worked well, giving her the financial lifeline she needed.
Fast-forward six years, and today it can take Moore twice as many hours to take home the same money through driving she once did.
What’s an Uber driver to do? Even if Moore wanted to take the company to court, she couldn’t. There’s a built-in, internal resolution mechanism she must turn to. For an Uber driver in Toronto, they’d have to go a bit further a field. To the Netherlands.
Moore says she wishes she could go back in time and warn just how widely ride-hailing services would proliferate and, in her view, how much damage the companies can cause when they go unregulated.
Instead she’s sending a warning to Canada while, she believes, it still has a chance to rein in the service that took her home state by storm.
“This is the ultimate robber-baron model in the second gilded age of America,” Moore said, speaking by phone interview from L.A. about what she views as the exploitation of drivers by ride-hail apps. Drivers have to perform work without the advantages of official employment attached.
“If you don’t have the industry yet, you have the opportunity to fix this.”
Ride-hailing is at a crucial juncture in Canada, not only because British Columbia is preparing to welcome the service that has been operating in Toronto and countless cities south of the border for six years already, but also because a proposed class action lawsuit that began in Toronto may throw a wrench into ride-hailing giant Uber’s way of doing business.
The stakes for the company if the Supreme Court of Canada next month rules against it are likely tens of millions of dollars.
Alternatively, if the court rules in Uber’s favour, critics say, it could open up a new Pandora’s box — giving employers across the country a way to avoid getting sued by their workers.
The question at the heart of the case, a proposed class action filed by law firm Samfiru Tumarkin LLP, is whether drivers for ride-hailing platforms such as Uber and Lyft — the companies call them independent contractors — will be considered employees.
Lior Samfiru, the lawyer on the case, argues they are employees, since Uber sets prices for trips and has the ability to disconnect drivers from the service based on performance.
Being considered employees would entitle drivers to protections such as overtime, minimum wage and vacation pay.
But before Samfiru can argue the employment-classification issue at the heart of the class action, he first has to convince the Supreme Court that the case should be allowed to proceed.
Get more of today’s top stories in your inbox
Find everything you need to know about what’s happening in Vancouver in our Morning Headlines newsletter.
Uber is arguing the class action is not allowed to go forward, because its drivers sign terms and conditions where the parties “mutually agree” that any dispute between them will not go to court, but through an arbitration process in the Netherlands.
In an interview at his Vancouver office, Samfiru said the Supreme Court would hear the issue on Nov. 6, and that the decision could have wide-ranging ramifications for workers in Canada.
“The reason we have employment laws is that government decided there’s an imbalance of power between employers and employees,” Samfiru said. “If we lose, we don’t have employment laws in Canada.”
Although a Supreme Court decision in the case would not actually nullify the country’s federal and provincial employment laws, a decision in favour of Uber would put the high court’s seal of approval on a system that allows employers to avoid getting sued by the people who work for them by setting up independent arbitration systems in countries that would cost employees a lot of money and time to travel to — something well out of reach for many low-income workers.
Veena Dubal, an associate professor of law at UC Hastings in San Francisco who has studied the impact of ride-hailing on the labour market, said a decision by the Supreme Court in Uber’s favour would set “a terrible precedent for workers.”
“The impact would be across sectors: any company that hires employees or independent contractors would put in their contracts that if you had any complaint you would have to arbitrate the claim in the Netherlands,” Dubal said. “It would essentially cut off any legal remedy for workers.”
Uber Canada did not respond to Star Vancouver’s request for comment on the class action suit as of press time.
Moore, who lives in Los Angeles, said there are plenty of reasons why drivers may want to challenge Uber, Lyft, and other ridesharing companies. When the companies began rolling out their services in her city, she said she was able to make a fair amount of money — enough to support her family’s budget by working one extra 8-hour shift per week on top of her full-time job. But since the companies have control over the pricing, and how much drivers get, she now has to work double the time to get the same amount of money.
“What happens at the beginning is that everybody (buys) into it and it damages your taxi industry and … now we’re making far less than minimum wage after expenses as drivers,” Moore said. “We have no leg to stand on without having the regulation (protecting employees).”
The complaint that drivers were getting less money for more work is part of what sparked mass protests in California demanding employment rights for drivers, driven in part by Moore’s group Rideshare Drivers United, an unofficial organization with 5,000 rideshare driver members that would like to be recognized by Uber and Lyft as a union.
While Uber and Lyft continued to assert the drivers are independent contractors who are not owed employment rights, the legislative assembly of California passed legislation that will, as of January 1, include ride-hail drivers in the state’s definition of employees and therefore entitle them to minimum wage and overtime pay.
Lorena Gonzalez, the California assemblywoman who introduced the bill, said the drivers she’s heard from described a “spiral down” of their experience with ride-hailing apps, where it started off lucrative and now they can’t make ends meet.
“There’s no set standard and there’s things that change constantly,” Gonzalez said in a phone interview. “Now they’re in a position where you have a lot of gig workers who are struggling to make ends meet. Folks who live in their car.”
Thinking about how things turned out in California after six years of ride-sharing, Gonzalez said Canada — and B.C. in particular since it has had the opportunity to observe the workings of ride-hail before bringing it in — may be in a good position.
“One of the problems in California has been catching up what we had allowed to flourish,” Gonzalez said. “They did a good job of cropping up and expanding very quickly, creating a situation where it was tough for the legislature to come in and regulate.”