Uber drivers: Many don't get minimum wage

Saturday, 10 March 2018

There is little official data kept on Uber drivers.

New Zealand Uber drivers say it's common for them to earn less than the minimum wage.

A report in Australia this week argued Uber's low fares were only possible because its drivers were underpaid.

Uber drivers take a lot of risk compared to the money they earn.

The Centre for Future Work at the Australia Institute examined the earnings of drivers on Uber's cheapest service, UberX.

It found they earned A$18 (NZ$19.39) on average in Sydney and Canberra but only A$11 an hour in Perth. Australia's minimum wage is A$18.29 an hour.

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It follows work from MIT in the United States that found drivers there were earning between US$8.55 (NZ$11.74) and US$10 an hour.

Uber drivers around the world operate as self-employed contractors. From the fares they take from passengers, they pay 25 per cent to Uber, and have to cover tax, ACC, insurance, petrol costs and car maintenance.

Ben Wilson, of the New Zealand Uber Drivers' Association, said it was hard to get a clear picture of drivers' earnings in New Zealand.

Only a small number of people had been working for the platform long enough to get a clear idea of a full year - and fewer still had calculated their costs correctly. Those who were not paying tax correctly often did not want to disclose their earnings at all, he said.

But Wilson said, for those who could supply data, earnings were about $10 to $12 an hour.

New Zealand's minimum wage is currently $15.75.

There is no minimum for self-employed contractors.

Wilson, who has since stopped driving, said it was not easy work. 'It's not back-breaking but it is dangerous,' he said. 'One of the main ways people die [is in car crashes] and Uber drivers are doing ten times as many hours on the road. There's no danger money in there.'

He said it was common for drivers to buy cars to work for Uber, but the platform had the power to cancel its agreements with drivers at its discretion.

Wilson said many people joined Uber thinking it was a good opportunity to make money without having to deal with a boss.

But when they started to look at it seriously, it became clear it was a lot of work for not a lot of money.

'You're working quite hard compared to someone on the minimum wage at McDonalds and there are all these risks and costs.'

When he was driving, while studying, he focused on working the busiest periods and managed to clear $14 an hour after expenses.

Those who stuck it out were often elderly people who wanted social interaction, he said, or young people who had help with the cost of running their cars.

Migrant workers who were not meant to be working in New Zealand might also opt for Uber. 'They're not going to say they are being exploited.'

An Uber spokeswoman said: ''Driver-partners tell us they choose Uber because of the flexibility the app provides in letting them earn money in hours that suit them and their families - for some that might be 9-5, but for others it can be weekend evenings, or the early hours of the morning. Earnings vary depending on when driver-partners choose to use the app, and the vehicle they choose to drive.'

The Taxi Federation said there was no information on what taxi drivers earnt.

Many were shareholders of a company or franchise-holders and worked on a self-employed basis, too.

But executive director John Hart said, in some situations, people would be employed on an hourly rate above the minimum wage, and then given a share of a shift's takings.

'There's a range and for self-employed drivers it depends on how hard you want to work. Some only work four, five, six hours a day while others work all the hours available to them by law. No one is making a fortune but there is a reasonable living in it.'