> 4) The driver is paid based on minutes and miles, via some formula that they've agreed to.
TFA says the driver is paid based on an estimate of minutes and miles. This to me is key...
If both the driver and passenger are paying based on an estimate of miles and minutes, then it should be the same estimate for both of them.
However, if the driver is paid by Uber for actual recorded miles and minutes, but the passenger is paying a fixed rate based on the estimated miles and minutes, then I think Uber is absolutely in the clear.
Assuming it's the later, here's how I see it. The miles/minutes estimate provided to the customer is used to derive a fixed price contract for the ride. The customer sees a price, and can decide if they want to accept it. The contract between Uber and the Customer is now set.
On the driver side, I don't know if drivers are contractually supposed to follow exact route instructions from the app, or if they are allowed to deviate based on their own knowledge of the route. But in any case the app is giving turn-by-turn real-time instructions to the driver, instructions which can change minute to minute as the route conditions change. This is necessarily a completely different algorithm than the fare quoter.
There's no requirement, or even a reasonable expectation, that Uber is charging the passenger a fixed price increment over the amount paid to the driver. Based on anecdotal UberPool reports, I would expect there are in fact many cases where the passenger is actually paying less than what the driver is being paid.
On the other hand, if both driver and passenger are paying/paid based on a pure estimate of the miles/minutes to get from A->B then it is a bit of an eyebrow raise if there's a spread between the estimates which Uber profits off of.
You've misread the article. It in fact says that the driver is paid for actual miles/minutes.
> Meanwhile, the software utilized in the driver’s application, which navigates the drivers to the User’s destination, utilizes traffic conditions and other variables to provide the driver with a more efficient, shorter, or quicker route to the User’s destination, resulting in a lower fare payout to the driver.
Further, if you read the actual lawsuit, its clear that the lawsuit is simply claiming that Uber shouldn't be able to pocket the difference between the higher estimated collected amount, and the lower actual amount. They are claiming that Uber represented to them that they "were receiving the full fare, minus the [Uber's] service and booking fees"
This latest lawsuit claims that Uber implemented
the so-called "upfront" pricing scheme in September
and informed drivers that fares are calculated on a
per-mile and per-minute charge for the estimated
distance and time of a ride.
So reading that again I think you're right that's just talking about fares passengers pay, not fares paid to the driver.
Another key question -- what if Uber underestimates due to changing traffic conditions? Does the driver get underpaid? I doubt it.
So of course the estimate is going to be conservative. So what's the contract say? Probably pretty clearly drivers are paid on actual miles and minutes and not Uber's estimate. I mean, if drivers were paid on the estimate, Uber would still probably be getting sued because it is sometimes low.
It doesn't make sense engineering and product wise to pay the drivers on the estimate instead of waiting for the trip to finish and do the fare calculation. So I think the latter sounds reasonable.
I think the core debate should not be about payment based on estimate/actual (for whichever party), but rather whether there are to transactions (uber-driver and uber-rider) or one (rider-driver), which Uber facilitates. Or as other commenters worded, whether rider is paid for minutes/miles/trips by Uber, or minutes/miles/trips by rider with fixed Uber's cut. Calculation method is irrelevant here.
TFA says the driver is paid based on an estimate of minutes and miles. This to me is key...
If both the driver and passenger are paying based on an estimate of miles and minutes, then it should be the same estimate for both of them.
However, if the driver is paid by Uber for actual recorded miles and minutes, but the passenger is paying a fixed rate based on the estimated miles and minutes, then I think Uber is absolutely in the clear.
Assuming it's the later, here's how I see it. The miles/minutes estimate provided to the customer is used to derive a fixed price contract for the ride. The customer sees a price, and can decide if they want to accept it. The contract between Uber and the Customer is now set.
On the driver side, I don't know if drivers are contractually supposed to follow exact route instructions from the app, or if they are allowed to deviate based on their own knowledge of the route. But in any case the app is giving turn-by-turn real-time instructions to the driver, instructions which can change minute to minute as the route conditions change. This is necessarily a completely different algorithm than the fare quoter.
There's no requirement, or even a reasonable expectation, that Uber is charging the passenger a fixed price increment over the amount paid to the driver. Based on anecdotal UberPool reports, I would expect there are in fact many cases where the passenger is actually paying less than what the driver is being paid.
On the other hand, if both driver and passenger are paying/paid based on a pure estimate of the miles/minutes to get from A->B then it is a bit of an eyebrow raise if there's a spread between the estimates which Uber profits off of.