On Wednesday morning, a small group of people huddled over their phones at the foot of the giant glass skyscraper that houses Uber’s London headquarters. They were running an experiment to solve one of the greatest mysteries in the platform economy right now: how Uber’s algorithm calculates driver pay.
Experiment to Unveil the Mystery of Uber’s Algorithm
Beneath flags and banners calling on Uber to “Stop Dynamic Pricing,” one driver ordered a ride, acting as a customer to Heathrow Airport, and received a quote for £46. Seconds later, the job pinged up on the phone of a fellow protester, who had told the app he was ready to drive. His fee? £26.
For years, Uber has taken a commission of 25 percent from London-based drivers. However, the company told drivers in January 2023 that the app was updating its pricing model, a change it said was necessary to make fares appeal to drivers and offer the lowest pickup time for passengers.
Yet, the people behind the wheel say those changes have lowered their wages and made the calculation method impossible to understand—sparking fears that dynamic pricing is offering drivers across Europe and the US personalized wages, a charge that Uber denies.
Drivers’ Voices: A Call for Transparency
“A few years back, the fare was transparent, you used to see how much the passenger was charged,” says Farah Musa, an Uber driver since 2015, who is taking part in the protest and 24-hour strike. Now the information is hidden, and he doesn’t understand how the fare is calculated. “Dynamic pricing is not good for drivers. We are being cheated.”
Uber’s “surge pricing” feature used to kick in only during busy periods, making rides more expensive to incentivize drivers to log in to the app. Now, however, the app uses variable or “dynamic” pricing all the time, says James Farrar, the former Uber driver who won a landmark case against the company in the UK Supreme Court and is now director of nonprofit Worker Info Exchange.
“We’ve gone from a completely transparent pay and pricing system to one that’s now completely opaque,” he says. “People literally do not understand how the pay has been set, how the work has been allocated, and how they may have been profiled in that decision-making.”
The Financial Strain on Drivers
It’s only Uber that knows how the wages are calculated, says Lucky Matthew, at the London protest, who says he now receives £400 ($509) per week less than before the pandemic. “We’re working the same hours as before, the cost of living is going up, but wages are going down.”
Many of the drivers at the protest have been asking their passengers how much they are paying for the ride, and their answers have unleashed a wave of anger toward the company because they claim Uber is taking much more than a 25 percent cut.
“It’s a scam,” says Cristina Ioanitescu, who drives an Uber XL and carried a sign reading “Smart Pricing = Smart Cheating.” “It’s a lot of stress for us.” Uber says that although commission fees vary, they can sometimes be as low as 0 percent and drivers can see the fare before accepting a trip.
The Struggle Continues
The clash between drivers and company over pay transparency is emblematic of broader issues within the gig economy, where workers often feel at the mercy of algorithms they don’t understand. As protests like the one in London continue to draw attention to these issues, it remains to be seen whether company will take steps to address the concerns of its drivers or continue to operate within its current model.
