Welcome to the gig economy: prospective Hamilton Uber drivers warned of hidden cost
Wednesday, 24 January 2018
The first Uber ride has taken place in Hamilton, but a driver advocate is warning the true cost of convenience remains unseen.
Uber's 'driver zero' for Hamilton, Albert Corbett, collected All Black Sam Cane from his Hamilton home on Wednesday afternoon.
In a promotional stunt for the ride sharing platform's Thursday launch, Cane was delivered to Hood St.
Corbett is a 67-year-old workplace trainer with little work available this time of year, and said Uber would keep the bank balance 'going up'.
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He would work 'as many hours as the wife allows'. He had only heard of positive Uber experiences, though had seen media reports of low profits abroad.
'Based on the figures I've been doing, I'm hoping to make more a damn sight more than that.'
Cane said Uber would be a great convenience, as taxis at Hood St were often overloaded in the early hours of a weekend morning.
The launch of Uber marks Hamilton's entrance into the 'gig economy' - informal, short-term work often arranged over online platforms.
Peter Gallagher, director of professional driver advocacy group ProDrive, warned few drivers receive the minimum wage when driving for Uber.
Uber drivers aren't considered employees, and must pay their own tax, ACC levies, GST (unless GST registered), and all phone data and vehicle costs.
He said the majority of new Uber drivers are recent migrants, who don't understand these expenses, New Zealand law or the fundamentals of a contract.
'They do so out of a sense of desperation for work. They are subject to unilateral, arbitrary rate changes whenever Uber chooses, and without recourse or discussion.'
This happened to drivers in Auckland and Wellington in April 2016, when Uber dropped fares by 20 per cent.
Gallagher was critical of Uber's tax record. The only available public annual report shows in 2014 the company paid $9397 in tax while earning a revenue of more than $1 million.
Uber has some 4000 drivers, and it's often cited drivers can earn $1200 for a 40-hour week. The company takes a 25 per cent cut.
By Gallagher's rough estimate, the company may now draw as much as $1 million from New Zealand every week.
'The consumers have always loved Uber, they still love them now, and Hamiltonians will be no different.
'Why the hell would Hamiltonians contribute to a global multinational who simply arrives here … and in every respect functions like a parasite?'
He said calling Uber 'disruptive' was a euphemism for exploitative.
Uber defines itself as an information service, a facilitator between drivers and riders, which doesn't employ drivers. But Gallagher said it was far more.
'Uber organises and controls every facet of the transportation of a passenger from point A to point B.'
The company is known throughout the world for flouting transportation regulation, which it did for over a year in New Zealand before transport laws changed in October 2017.
Previously, Uber New Zealand general manager Richard Menzies said bringing the flexible income of Uber was a flexible, economic opportunity for Hamilton.
'Just under 40 per cent of our driver-partners drive less than 10 hours a week, so they may work during the week and drive with Uber to help pay their mortgage.'
As Uber doesn't formally employ drivers, any vehicle expenses and tax costs are the responsibility of the driver.
'We generally leave things that are dependant to the individual vehicle to the drivers themselves.'
Prodrive has taken Uber to three dispute tribunals and currently has a case before the district court.
Victoria University law professor Gordon Anderson said, as long as drivers are not recognised as employees, they have no rights to the minimum wage or other benefits.
'You have very little legal recourse should anything go wrong.'