Labor

Uber and Lyft Drivers Set to Strike Before Uber IPO

Uber and Lyft drivers in several major cities across the globe are planning a 2-hour strike set for May 7, 2019- the day before Uber shares begin to trade publicly. Labor groups who are organizing the strike are protesting the companies’ payment and labor practices, and hope that their early morning-rush hour strike will cause enough congestion to not only make Uber and Lyft executives take notice, but also the financial press covering the much awaited Uber IPO.

Source:  Uber

Source: Uber

According to the New York Taxi Workers Alliance, rideshare drivers in New York City, Philadelphia, Boston, and Los Angeles are scheduled to go on strike from 7AM to 9AM on Wednesday, May 8th. According to the Independant, the participating cities in the UK include London, Birmingham, Nottingham, and Glasgow.

The New York Taxi Workers Alliance has released three demands to coincide with the strike:

  1. In solidarity with our driver brothers and sisters fighting to stop poverty and debt and in support of their national demands!

  2. To win Job Security for App Drivers by ending Unfair Deactivations in NYC!

  3. To secure a Livable Income by ending the scam of Upfront Pricing where passengers pay more but drivers earn less. Regulate the fare Uber/Lyft/Juno/Via charge passengers, and cap the Companies' commission, guaranteeing 80-85% of the fare to the driver!

Uber is projected to go public at the largest, or one of the largest valuations for an IPO. According to the New York Times, “Uber expects to be worth as much as $91 billion when it starts selling shares next month, making its initial public offering one of the largest in the history of the technology industry.”

While the rideshare company has become a political behemoth, noted for its bull-headed early strategy of entering markets before laws were created to accommodate it and treating cities like its own private laboratory, this moment before Uber’s IPO is also one of its most vulnerable. According to Business Insider, “Dara Khosrowshahi could get a huge payday — totaling more than $100 million according to a source — if Uber's IPO valuation hits $120 billion and stays at that level for 90 consecutive days.” This means that Uber’s CEO has $100 million on the line to make Uber’s transition to public company as smooth and valuable as possible.

Source:  Uber

Source: Uber

If drivers are able to generate enough strain on the rideshare systems to cause a public outrage, or even just a media one, then the drivers who are often considered to be exploited by rideshare companies can leverage this window of opportunity to either guarantee that Uber’s CEO doesn’t get his $100 million bonus, or demand more livable wages and treatment.

Presidential Candidate Bernie Sanders has even responded to the strike in a statement on Twitter, “Uber says it can't pay its drivers more money, but rewarded its CEO with nearly $50 million last year. People who work for multibillion-dollar companies should not have to work 70 or 80 hours a week to get by. I stand with the Uber and Lyft drivers going on strike on May 8.”

Although not specifically tied into the driver IPO strike, the environmental nonprofit and activist group, Sierra Club, has also entered into the fray with a new campaign, that takes advantage of the IPO media, to urge Uber and Lyft to electrify their fleet. In a statement to the Verge, Andrew Linhardt, deputy advocacy director at the Sierra Club said that, “they need to put real funding behind these incentive programs, especially for full-time drivers, and get them more quickly into electric vehicles. They have the market power to help shape the EV market.”

Whether it’s workers rights, fair pay, or vehicle electrification— Uber, and its executive team, have a lot to consider before their upcoming IPO. Uber is set to become one of the largest, if not the largest, IPO in market history at around a valuation of $91 billion. While there has been much mythologizing about Uber’s executive culture of relentlessness, in actuality it’s their drivers whose backs they built their fortunes on. Rideshare companies like to tout their environmental nature and efficiency, but in actuality their fleet still burns gas. With the May 8th strike, hopefully those who will benefit least from the company’s windfall will begin to have their say.