The city vows to revoke the ride-hailing giant’s license, citing public safety concerns. But the legal battle may be only starting.
It’s all over for Uber in London. This morning, Transport for London, the city’s transit body, announced that, in response to concerns about the company’s “lack of corporate responsibility” it would not renew Uber’s license to operate in the city.
Uber has 21 days following the September 30 expiry of its current license to try to overturn the decision. If its appeal is rejected, Uber’s 40,000-odd drivers will lose their right to operate on London’s streets within a month. For one of the world’s most successful tech companies, it’s a major setback, to say the least.
It’s also one that’s causing a storm of controversy in Britain, with some voices coming out in support and others calling for a boycott of black cabs, London’s established taxi service, in protest. London’s Mayor Sadiq Khan moved immediately to back the move, saying that Uber had not been playing by the rules. In a statement releases this morning, he said the following:
“I want London to be at the forefront of innovation and new technology and to be a natural home for exciting new companies that help Londoners by providing a better and more affordable service. However, all companies in London must play by the rules and adhere to the high standards we expect—particularly when it comes to the safety of customers. Providing an innovative service must not be at the expense of customer safety and security.”
That concern over customer safety and security relates to several incidents. Firstly, Uber has been accused by London’s Met Police for systematically failing to report sexual assault, placing the company’s reputation before public safety. There has also been broader concern about the company’s handling of the 32 rape and sexual assault claims it received in the 12 months prior to 2016. If a case against a driver is dropped—and given that only 28 percent of British rape cases actually make it to court, that probably means that most are—Uber fires or reinstates the driver at their own discretion. This has led to fears that sexual assault perpetrators working for Uber may be heading straight back onto the roads.
Then there is also the issue of working conditions for Uber drivers, which have been criticized by Britain’s unions as inherently exploitative. Uber lost the right to classify its drivers as self-employed (and thus not eligible for holiday pay or pension contributions) in a court case in December 2016 — a decision it is still appealing. In addition, TfL has also expressed concern about Uber’s failures in doing proper criminal record checks and medical certificates, not to mention the long-smoldering international issue of Uber’s use of “Greyball” software to evade law enforcement and regulatory personnel.
The powerful blow against Uber may also partly be driven by lobbying from London’s Licensed Taxi Drivers' Association—drivers of the city’s iconic portly black cabs, who have found their business severely undercut by a company whose modus operandi they regard as unethical and exploitative. Ride-sharing companies like Uber are in the process of devastating taxi industries in major American cities like Chicago and New York; London cabbies can see the writing on the wall.
It’s easy to see why black cab drivers are frustrated. Obtaining a black cab license is a famously rigorous process, in which prospective drivers are expected to acquire “The Knowledge”: They memorize every street in London. The process of learning the city by heart often takes years (and reshapes their brains, according to MRI studies), after which the drivers must buy an expensive hackney carriage.
In the past, taxi fares that were relatively higher than most other major world cities allowed black cab drivers to steadily scrape back their investment, though they have long faced some degree of competition from minicabs, as private hire taxis are called in Britain. Now, faced with Uber drivers whose satnavs can replace most (albeit not all) of their hard-won Knowledge, many black cab drivers are struggling to make a decent living. That this competition has come from a company engaged in a race to the bottom when it came to drivers’ pay and conditions has only made the struggle more bitter.
Not everyone is delighted with the prospect of Uber’s departure, though. As this New York Times piece notes, London’s black cab drivers have long had a bad reputation among people of color and other minorities as bigots, reluctant to halt for a black face and rarely shy of sharing their inflammatory opinions. It would deeply unfair to damn all black cab drivers this way—many of whom are people of color themselves—but this notoriety doesn’t come from nowhere. Many Londoners prefer Uber not just because it’s cheaper but because, Greyball-use aside, its drivers are less likely to screen them out.
Was explaining to a (white) friend that for all its flaws, Uber is life support. I KNOW the driver will accept my fare (unlike black cabs)— Citizen of Nowhere (@sunnysingh_n6) September 22, 2017
Could some compromise be brokered in the next few weeks? Uber is unlikely to abandon its largest UK market without a stout legal battle, and in the U.S., the company has managed to claw its way back into cities that once evicted them. In Scandinavia, the careful regulation of Uber and other ride-hailing services (a process which saw the UberPOP service scrapped in Sweden and Denmark) shows that a compromise that allows Uber to continue operating under tighter regulation might well be possible. If the backlash against the revoking of Uber’s license is strong, it’s possible that some renegotiation might take place. One thing is nonetheless very clear—TfL and Mayor Khan are not planning to play this battle softly.