Taxi-hailing drivers under the aegis of the National Union of Professional App-based Workers (NUPA-BW) have revealed that they are working on a class-action lawsuit against Uber and Bolt.
The new development follows Uber’s recent classification of its drivers in the UK as workers. This new designation, according to the company will give them benefits like holiday pay, pension and a guaranteed minimum wage.
In a chat with Technext, President of NUPA-BW, Comrade Ayoade Ibrahim, claimed that Uber and Bolt drivers in Nigeria are also entitled to rights as employees, legally classified as worker’s under Nigeria’s legislation.
He added that they seek compensation for unpaid overtime and holiday pay, pensions, social security as well as unionized recognition.
We like to use this opportunity, seeing what’s happening in the UK and South Africa, to start our class action (lawsuit) against Uber and Bolt operations in Nigeria. We want them to respect the Nigerian constitution and labour law/Act. This is an opportunity for the Nigerian government especially the ministry of labour and productivity and the ministry of transport to do needful.
Comrade Ayoade Ibrahim, President of NUPA-BW
Uber compromises as gig model begins to unravel
For years Uber has been in an uphill battle on several fronts on its gig model. In almost every city Uber launches, it never takes its drivers too long to form unions, and/or get regulators on their side to make the case that Uber is an employer of labour and should act like one.
In the UK, the battle between the company and worker union has been on and off since 2016. Another major battlefront is in California where the Prop 22 ruling last year was a big win for the ride-hailing company.
Similarly, in Africa the company is facing lawsuits on driver status. In South Africa, Uber drivers filed a class-action lawsuit against Uber BV and Uber SA in February.
However, the U.K.’s Supreme Court latest ruling that reaffirmed that drivers using the app are workers and not independent contractors has dealt a crucial blow to Uber’s gig Model.
Following the ruling, Uber announced a worker system that will see drivers in the UK now being entitled to some benefits. This is is the first time Uber has wavered on its GIG model and it could have far-reaching implications.
Nigerian e-hailing drivers also want to be classified as workers
Seeing the development in Europe, Ayoade says that the union is planning to leverage opportunities from UK and South Africa to start its own class action against Uber and Bolt operations in Nigeria.
He insisted that the ride hailing companies also have to respect the Nigeria constitution and labour law/Act that legally classify them as workers.
This is however not the first time Uber Drivers in Nigeria will file a class action suit against the company asking for employee benefits. In 2017, two drivers representing other drivers on the platform started a class action suit asking Uber to provide its drivers with health insurance and pension benefits.
However, the company insisted that the independence it offers drivers remain a major attraction. An Uber spokesperson, Francesca Uriri, explained that the vast majority of drivers who use Uber say the reason why they signed up to use the app in the first place was because of the freedom and flexibility it afforded them.
The President of NUPA-BW has, however, revealed that the union has the backing of a significant number of drivers. He revealed that the union is now in consultation with other App-based drivers to join the lawsuit.
“If you check UK legal action only 20 App-based drivers started it. 2 people at most are the leading claimant. So it doesn’t matter if we didn’t get 100 % of Drivers. We have the support of the majority and we’re working on the modalities. We start the class action lawsuit against them soon,” he concluded.
Comrade Ayoade’s NUPA-BW may have a tough time winning the case though, as an aspect of the law may be on Uber’s side. Section 91(d) of the Labour Act states that:
“worker” means any person who has entered into or works under a contract with an employer […] but does not include […]
(d) representatives, agents and commercial travellers in so far as their work is carried on outside the permanent workplace of the employer’s establishment.”
The exception could technically rope in Uber and other ride-hailing drivers but thats for the court to decide.
Would Nigerian drivers be better off as employees?
In Lagos and Abuja, Uber’s biggest market in Nigeria, it is not uncommon for drivers to make about N100,000 from Uber rides weekly. They can even make as much as N200,000 during the festive season, according to Sunday, an UberDriver who works in Lagos.
Another driver, Gbenro Ogundipe, says he makes around N25,000 to N35,000 for the week, after paying for fuel. Driving 40 hours per week, Uber drivers in Lagos make between N80,000 to N120,000 in a month while the minimum wage in Nigeria is N30,000.
If drivers move from being independent contractors to employees of Uber in Nigeria, it is unlikely that the company will pay drivers up to N100,000 in salary.
Also, the flexibility of them being able to use more than one ride-hailing company for their work may be prohibited. Tope, an Uber Driver told Technext that he uses both Uber and Bolt. He explained that he shuffles between both so that he can complete more rides.
Whether its Uber or Bolt, I accept rides from the app that first gives me rides.
However, there are plus to them being employees, especially that of an international company as they will be entitled to benefits such as health insurance, pension and holiday bonuses.
Can Uber afford to classify all its Drivers as Workers?
Uber’s classification of drivers as independent contractors is fundamental to how it operates. It allows the company to avoid paying any employee benefits, a guaranteed minimum wage or be liable for any extra expenses incurred by the drivers.
With over 200,000 drivers, a minimum wage of $12 per hour and a work time of 12 hours, Uber is estimated to pay about $806,400,000 in salary a month in Califonia alone if Drivers become employess.
Employing all its drivers as staff will prove expensive even for a company currently valued at $106 billion.
However, it appears that Uber itself has realized that the gig model as it is may not last for longer. Asides from the UK, the company is also proposing changes to labour laws in Canada. The new laws would allow its employees to receive benefits and safety protection.
According to Uber senior vice-president, Andrew MacDonald, the company’s current employment system has some fundamental flaws that COVID has exposed. She added that this is a good opportunity to change.
“Our view is our current employment system is outdated, unfair, and somewhat inflexible and some workers get benefits and protections and others don’t. We feel that COVID has exposed some of those fundamental flaws and think this is a good opportunity for change.”
Andrew MacDonald, Uber’s senior vice-president
Recall, that during the lockdown caused by the pandemic, Uber rides significantly dropped across the world resulting in reduced income for its drivers.
With the development in Canada, It appears that the VP has seen this as a big challenge in Canada. However, there is no illustration if Mr MacDonald’s comments referred to all of Uber’s 38 markets
In Summary
The flexibility to choose working hours and handsome income has made e-hailing a preferred alternative source of income, not necessarily the main gig for many Nigerian drivers.
However, with the attractive benefits their counterparts in the UK will now be getting, Uber drivers who were on the fence about the employee status will now seriously consider it.
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