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Gig Workers Rising

Why We Shouldn't Patronize Uber

Huge protests in San Francisco highlight shortcomings as IPO draws near

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by Guest Post on
Apr 15, 2019

As Uber filed its long-awaited IPO with the SEC on Tuesday, April 11, more than a thousand San Francisco city workers and gig workers protested outside the company's headquarters. The protest called out Uber's business practices of paying drivers poverty wages and minimizing their contribution towards public services.

City workers who provide vital programs to the San Francisco's most vulnerable residents—from nurses at public hospitals and clinics to social workers and case managers at the city's Human Services Agency—say that critical city departments and services are already understaffed and overwhelmed.  And with the rising rates of income inequality resulting from IPOs of tech giants like Uber, they're bracing for further challenges provide the necessary public services to keep San Francisco a safe and healthy city for all.

Mostafa Maklad who drives for Uber, is part of Gig Workers Rising, a coalition of Lyft and Uber drivers. Maklad explained how these companies are shorting drivers: "We bear all the costs and Uber makes all the money. We just keep making less and less and are having to work longer hours just to barely break even. Uber and Lyft say we have flexibility, but we actually have none. If you have to work 80 hours a week to make ends meet, that's not flexible." 

"Yesterday Uber announced the beginning of their initial public offering.  We know what that means as executives stand to make tens, if not hundreds of millions, on the backs of drivers.  We can expect to see rates cut and poverty wages worse than ever before while the rich get richer and Uber makes a killing.  We cannot believe the smokescreen of the great tech economy; Uber's IPO is bad for drivers and just as bad for San Francisco residents who are being displaced due to skyrocketing rents."

Uber is not only being a key driver in the unaffordability crisis in San Francisco, but it is also actively minimizing its tax payments into federal coffers that help subsidize homeless and housing programs in the city.

By using an intricate network of foreign tax havens and subsidiaries, Uber shields its earnings from being taxed at the U.S. rate. Uber has used a scheme of Dutch subsidiaries to pay a tax on less than 2% of its foreign earnings, avoiding paying on billions in revenue that could have gone towards local communities to fund public services and fix infrastructure. In 2016, it was reported that Uber sold its Chinese operations to a competitor for $7 Billion. However, its tax shelter scheme ensure than only an estimated $101.5 million from this sale would be taxed by the U.S., resulting in a loss of over $1.3 Billion in federal tax dollars that could be used to help fund vital city and county services.

 "In a city as absurdly rich as San Francisco, there is no reason for thousands of families to be left behind. The City is experiencing unprecedented wealth, but more and more families can't afford to live here, including the families of workers who keep the city running," said Joseph Bryant, SEIU 1021 President and SF City worker. "Meanwhile, multi-billion dollar corporations like Uber get to play by their own set of rules and not have to pay their fair share towards the public services that we provide."

Bryant continued, "Our city leaders also must take action on holding gig economy businesses like Uber accountable so that they: pay their fair share towards community services, operate with greater transparency, and stop flouting labor standards and start providing living wages and benefits to the drivers."

This post was written by SEIU 1021.

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