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Uber Predicts 40% Price Hikes Under EU Gig Worker Law

Uber

Uber said a proposed European gig worker law could trigger price hikes and service shutdowns.

Anabel Díaz, head of Uber’s mobility division in Europe, cautioned in an interview with the Financial Times (FT) Wednesday (Sept. 20) that the European Union’s platform work directive — being debated this week — should offer drivers flexible work options.

“If Brussels forces Uber to reclassify drivers and couriers across the EU, we could expect to see a 50%-70% reduction in the number of work opportunities,” Díaz said.

This would force Uber to cease operating in “hundreds” of the 3,000 European cities, she added, and could drive prices up by as much as 40%.

And “with fewer drivers, riders could expect to experience significantly longer wait times,” Diaz said in the report.

The platform work directive was first proposed by the European Commission in 2021 to harmonize employment definitions in the EU.

“While platform work and the associated concept of the gig economy has spread throughout the EU, countries have diverged greatly on how gig-style employment fits within existing labor laws,” that report said. “At the heart of the issue is whether platform workers are self-employed or should be considered employees and thus entitled to certain legal protections and benefits from their employer.”

Europe’s debate is happening as Uber deals with similar legal issues in the U.S. For example, the company’s drivers won a victory in July when California’s Supreme Court shot down an argument by the tech giant that aimed to limit efforts by drivers to bring employment disputes before a judge.

Also in July, a ruling by New York State Supreme Court Justice Nicholas Moyne temporarily halted a new minimum wage law opposed by Uber and other app-based delivery companies.

Meanwhile, PYMNTS Intelligence found some reluctance among younger workers to sign on with companies like Uber, according to the report “The ConnectedEconomy™ Monthly Series: Meet the Zillennials.”

“Specifically, the study found that just 50% of zillennials engage in platform work, finding gig jobs through platforms such as Uber, Care.com or Upwork,” PYMTS wrote last month.