Nabil K. Mark/Centre Daily Times via AP
Welcome to The American Prospect's weekly roundup highlighting the best reporting and latest developments in the labor movement.
(Compiled by Justin Miller-Edited by Harold Meyerson)
Uber's ceaseless public-relations problems continue to mount by the week.
Last week, the rideshare giant landed a $3.5 billion investment from Saudi Arabia, making the oppressive monarchy, with its long history of human rights violations and its laws prohibiting women from driving, the company's largest investor. In New York City, a group representing 5,000 Uber drivers filed a lawsuit charging that the company misclassifies its drivers as a way to avoid wage and hour laws and other labor law protections-just the latest in a string of similar suits. And as Uber struggles to find enough drivers with cars to meet increased demand, the company struck a deal with automakers and Wall Street investors to launch a vehicle-leasing program that some experts have likened to predatory lending.
For many, the onslaught of court cases and unsavory deals is a sign that the company is not the Silicon Valley disruption darling it has long been portrayed as, but just another corporation on the prowl for outsized profits.
Uber has operated in Saudi Arabia since 2014. For women, banned from driving themselves, it's become a helpful way to get around-even while they continue to fight for equal rights. For some Saudi women, the deal was seen as a crass move to profit off of oppression. "They're investing in our pain, in our suffering. This institutionalizes women's inferiority and dependency, and it turns women into an object of investment." Hatoon al-Fassi, a Saudi women's historian told Bloomberg News.
Uber rejects this assessment. "Of course we think women should be allowed to drive," an Uber spokeswoman told The New York Times. "In the absence of that, we have been able to provide extraordinary mobility that didn't exist before-and we're incredibly proud of that."
Meanwhile in New York City, the New York Taxi Workers Alliance and ten Uber drivers have filed a lawsuit charging that the company misclassifies its drivers as independent contractors, which they say amounts to stolen wages and a loss of labor protections. It's the latest in a string of legal actions against the company-the last one came in California, where drivers also alleged they were misclassified. Uber settled that case to the tune of up to $100 million in exchange for leaving the misclassification charge unsettled. The New York City case could result in a similar settlement, but it's possible that the Taxi Workers Alliance will try to push the case to court and get a firm ruling.
This case comes just weeks after Uber established a drivers association in New York City. It did so in partnership with a Machinists local that was trying to organize its drivers; the deal required that the unions stop organizing and refrain from launching lawsuits against the company. The Taxi Workers Alliance has criticized the deal for falling short of giving drivers collective bargaining rights, and some academics have said the association could become a company-controlled union-something that the National Labor Relations Act specifically forbids.
As Uber aggressively expands into new markets, it's finding that there is a limited supply of drivers who have cars that meet the company's standards. In response, Uber has raised $1 billion, with the help of Goldman Sachs, to launch a vehicle-leasing operation, dubbed Xchange Leasing, to get low-income people to start driving for them. Critics have likened it to a predatory subprime lending scheme. There is no credit requirement and Uber will automatically deduct payments from weekly paychecks. If drivers don't drive enough or fail to make a payment, the company repossesses the vehicle.
Houston Chronicle columnist Chris Tomlinson writes, "Xchange Leasing sounds more like a payday-loan racket built into a company store. The lease increases the company's control over the driver, who Uber still insists is nothing more than an 'independent' contractor. How is someone independent when Uber controls access to customers, sets the billing rates, demands a minimum number of hours and owns the car and the predatory lease on it?"
Is Walmart Dragging Feet on Wages?
Last year, Walmart, the country's largest employer, announced that it would raise its minimum wage to $10 an hour for its part-time and full-time workers. But as The New York Times reports, "the employees more critical of the company say Walmart ... has found more subtle ways to keep the reins on its workers' paychecks. The retailer has cut merit raises, for example, and has introduced a new training program that can keep employees at $9 an hour for as long as 18 months."
The development has worker advocates concerned about the company's motives. "I fear that Walmart's plan is more about delaying an actual wage increase than providing real training," labor professor Stephanie Luce told the Times-a charge that the company denies.
Allegations of corporate foot-dragging come at a time when the retail behemoth's most effective counterweight thus far, OUR Walmart, struggles to find its way forward.
Last year, the United Food and Commercial Workers union, the worker group's primary backer, withdrew its funding from the operation. As Dave Jamieson reports for Huffington Post, "Whatever successes the campaign may have had, the latest incarnation of OUR Walmart still needs to figure out how to keep the lights on. A non-union group may help win raises for workers, but it doesn't make dues-paying union members out of them."
For years, the group was successful in getting worker strikes and protests into national headlines and publicizing the plight of Walmart workers. Many attribute Walmart's wage increases to OUR Walmart's success.
Still, even as it tries to find a sustainable funding formula, the group has continued its work-though, so far, not as prominently. Last week it sent a delegation of workers to the company's annual shareholder meeting in Arkansas. Group members drove around Bentonville, home to Walmart's corporate headquarters, taping petitions to executives' and Walton family members' mailboxes, according to the Times.
As Jamieson notes, the ability of alt-labor groups like OUR Walmart to survive without union funding is a major question for the labor movement. Even as such campaigns have breathed new life into the worker rights fight, similar union-backed efforts, like the Fight for $15, could also become vulnerable to the exigencies of union finances or the whims of union politics-especially if the campaigns fail to translate to dues-paying members.
