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Uber’s not out of the woods yet
Driver classification remains an albatross for the company.
The ridehailing and delivery company reported a surprise net loss of $654 million for the first quarter of the year, as legal settlements and equity investments proved to be more of a drag on Uber’s business than many expected. It’s no secret that Uber classifies its drivers as independent contractors as a way to reduce labor costs and position itself as simply an app that connects customers to enterprising freelancers who work for multiple ridehailing and delivery companies. But if the company had to suddenly start paying drivers full benefits and a living wage across major markets, that willingness could erode in the face of a much more expensive trip or takeout order.
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