After years of flat denials, Uber has finally admitted to the deployment of automated decision making which discriminates between workers to personalise pay and task allocation.
On today's earnings call with investors, Uber boasted about the strategic advantage gained by the company from the deployment of its dynamic pricing system (aka 'up-front pricing') since it was rolled out across the UK and Europe from January 1, 2023. On the call with Wall Street investors, Uber CEO, Dara Khosrowshahi said:
So I think that what we can do better is actually targeting of different trips to different drivers based on their preferences or based on behavioral patterns that they're showing us, that really is the focus going forward, offering the right trip at the right price to the right driver, which is a win-win-win, the rider wait time is lower, drivers are seeing the trips that they want at the right price and the network gets more and more efficient.
And I would also say that the nature of upfront fares, you've gone from just flat time and distance to now kind of point estimates for every single trip based on the driver. It accrues to players who have the kind of data skills and the amount of data that we have. We have more of these point estimates, we make more of those point estimates, than anyone else. We're making these point estimates both in mobility and delivery. We're doing it globally
So all things being equal, our AI algorithms are going to be able to learn more and are going to be able to be more accurate than anyone else's which is an advantage that over a period of time is absolutely going to accrue to us.
For years, Uber has fobbed off workers, customers, regulators and WIE with the half-truth batch matching explanation. But workers saw an almost immediate deterioration in their pay after 'up-front pricing' (an antonym if ever there was one) was introduced last year.
In WIE's successful legal action against Uber at the Court of Appeal in Amsterdam, the court ruled that Uber, in breach of the GDPR, has not been sufficiently transparent about how 'up-front pricing' algorithms function given the obvious serious impact such AI decision making has on workers.
In addition or thereby, Uber also uses dynamic fares when determining the fare. In the opinion of the court of appeal, [appellant sub 1] et al. have sufficiently substantiated their claim and Uber has not sufficiently substantiated their dispute that the outcome of these decisions, taken as a whole, affects the drivers to a considerable extent. This system is applied to every passenger they carry. These are therefore successive decisions, each with financial consequences that determine the income they can earn.
Despite today's volte-face, we believe Uber has never met its legal obligation to inform workers regarding:
the existence of automated decision-making, including profiling, and........meaningful information about the logic involved, as well as the significance and the envisaged consequences of such processing.......
Nor has Uber properly consulted workers about the risks of such systems, something they are required to do for the completion of regulatory required risk and impact analysis.
And it isn't only workers who face risk from dynamic pricing systems, consumers do too. A Harvard Business Review paper called for dynamic pricing systems, such as those used by Uber and other gig economy platforms, to be closely regulated due to the risk of exploitation and tacit collusion.
Uber now has many urgent regulatory questions to answer after today's belated, though thoroughly unsurprising, admissions.