Over 12,000 Uber drivers found a way to weaponize the ridesharing platform’s restrictive contract in what’s possibly the funniest labor strategy of the year. But first: a bit of background. One of the more onerous aspects of the gig economy is its propensity to include arbitration agreements in the terms of service—you know, the very long document no one really reads—governing the rights of its workers. These agreements prohibit workers from suing gig platforms in open court, generally giving the company greater leverage and saving it from public embarrassment. Sometimes arbitration is binding; in Uber’s case, driver’s can opt out—but only within 30 days of signing, and very few seem to realize they have the option. Until an unfavorable U.S. Supreme Court ruling earlier this year, independent contractors often joined class-action lawsuits anyway, arguing (sometimes successfully) that they ought to have been classified as employees from the get-go. With that avenue of remuneration cut off, a group of 12,501 Uber drivers found a new option that hinges on the company’s own terms of service. While arbitrating parties are responsible for paying for their own attorneys, the terms state that “in all cases where required by law, the Company [Uber] will pay the Arbitrator’s and arbitration fees.” If today’s petition in California’s Northern District Court is accurate, those arbitration fees add up rather quickly. A group of 12,501 drivers opted to take Uber at its word, individually bringing their cases up for arbitration, overwhelming the infrastructure that’s meant to divide and conquer. “As of November 13, 2018, 12,501 demands have been filed with JAMS,” the notice states. (JAMS refers to the arbitration service Uber uses for this purpose.) Continuing on, emphasis ours: “Of those 12,501 demands, in only 296 has Uber paid the initiating filing fees necessary for an arbitration to commence […] only 47 have appointed arbitrators, and […] in only six instances has Uber paid the retainer fee of the arbitrator to allow the arbitration to move forward.” (Emphasis ours.) While a JAMS representative was not immediately available for comment, the cause of the holdup is Uber itself, according to the notice: Uber knows that its failure to pay the filing fees has prevented the arbitrations from commencing. Throughout this process, JAMS has repeatedly advised Uber that JAMS is “missing the NON-REFUNDABLE filing fee of $1,500 for each demand, made payable to JAMS.” JAMS has also informed Uber that “[u]ntil the Filing Fee is received we will be unable to proceed with the administration of these matters. We have no reason to assume this fee would be different based on the nature of each case, so some back-of-the-envelope math indicates the filings alone would cost Uber—a company that already loses sickening amounts of money—over $18.7 million. We’ve reached out to Uber for comment and to learn if they have an estimate of what that number would be after attorney fees and other expenses.   Case 3:18-cv-07343-KAW Document 1 Filed 12/05/18      


2 thoughts on “Uber’s Arbitration Policy Comes Back to Bite It in the Ass

  1. Tom says:

    Dara, do you plan on handling these claims in a timely manner that follows your partner agreement? Guessing your not or you would have already. Treat your drivers right!

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