Uber - the taxi industry mafia on steroids

For decades the taxi industry mafia has fought relentlessly and hard against every attempt by taxi driver associations, the Transport Workers Union and regulators to eliminate the archaic bailee/bailor system under which the industry operates, spending millions on depriving bailee drivers of the most basic industrial rights. Only a few choice government regulations have prevented it from creating a 21st century version of slave labour. Uber has no such restraints; Uber has no restraints at all. It can exploit its drivers, gouge its customers and evade taxes with impunity to such an extent that the taxi industry cartel is seething with envy.

by Peer Lindholdt

When it comes to unethical business practices and exploitation of workers the taxi mafia and Uber are peas in a pod, except that Uber can push the envelope a lot further as it has absolutely no moral or regulatory restraints as evidenced by its recent cut to its UberX fares in Victoria for the second time (15%) and Queensland (20%). Its justification: Dropping fare rates will increase the number of jobs booked and therefore driver income. No doubt Uber has an algorithm that calculates just how much it can screw its drivers before the number that wise up and resign exceeds the number of suckers who join up.

As metered taxi fares are regulated by the state, at least for now, the taxi mafia can’t manipulate fares the same way. They can and do offer cabbies discounted bookings, but the driver has the right to reject them. That, however, is about to change in NSW where the networks will be allowed to set their own fares for bookings (not hail and rank jobs) as soon as the new rules are passed by parliament and their new super-duper ihail app is launched in June. 10:1 we will see a drop in taxi fare rates, justified by applying the same logic as Uber, and Woolworth and Coles: cheaper prices = more business and stuff the supplier. The ‘uberisation’ of the Australian taxi industry will be complete by the end of the year as the majority of politicians are sucked in by the ‘Uber’ con.

It never ceases to amaze me that taxi drivers who drive somebody else’s taxi still believe the bullshit that they are self-employed and that they therefore have no right to common employee entitlements or industrial rights.

While UberX drivers around Australia are already chatting on social media about organizing against Uber’s exploitation, lies and deceit, bailee taxi drivers continue to live in denial.

As a bailee, you are required to abide by your network’s often draconian by-laws and to wear its uniform, and it can have your accreditation revoked at the drop of a hat. Your operator controls how many shifts you get, the hours you work and can sack you at will. You don’t supply your own tools (the taxi), you don’t set your own rates of pay and you don't choose which network you represent. The only autonomy you have is when to have a break and where you ply for hire, otherwise you are controlled by your operator, your network and by government regulations. In short, you are treated like an employee.

What amazes me even more is that most bailee drivers don’t really seem to care that they are being screwed out of thousands of dollars every year; in holiday pay, sick pay, superannuation and the list goes on. Even bicycle couriers are better off than you, at least in NSW. They are paid super by their bosses.

Way back in 1999 the TWU (Transport Workers Union) won a claim in the NSW Industrial Relations Commission for mandatory superannuation for courier and taxi truck drivers. The law came into force on 31 January 2000. Why it didn’t lodge a claim on behalf of bailees at the same time or immediately after beggars belief.

A courier, if he has worked full-time since, would today have a minimum of $70,000 in his super account. How much do you have?

In 1994, 5 years earlier, the taxi mafia spent $1 million in legal fees to prevent the Australian Tax Office from making superannuation for bailee taxi drivers mandatory. The mafia won the case thanks only to the incompetence of the ATO’s legal team and a flawed judgement.

Most recently the NSW Taxi Council spent a rumoured $500,000 fighting the TWU in the NSW Industrial Relations Commission to prevent drivers from, amongst other rights, getting a minimum wage and superannuation. After a 2-year battle, the NSW Government’s legalisation of ‘ridesharing’ and its proposed taxi reforms announced last December, prompted the IRC in February to postpone the case indefinitely. Another win for the mafia, this time thanks to Uber and the Baird government.

Not a penny was spent by the taxi mafia on court action to stop Uber Australia from operating during the two years it has been doing so illegally.

However, it may not be ‘game over’ - in fact a whole new game could be about to start and again Uber is the catalyst. One day we may see an epic fight against ‘the big end of town’ for industrial rights for all ‘point-to-point’ or P2P passenger drivers. That means taxi, hire car as well as minicab (ride-share) drivers standing up together for their rights.

“Don’t be bloody ridiculous! Uniting with UberX drivers - over my dead body!”, I hear you shout, and of course you are right … for now, but the situation is changing so rapidly that we either adjust or get left behind. Fact is minicabs are here to stay in one form or another. No rally in front of Parliament House is going to change that. Every state government will legalise ridesharing, naively believing it is a panacea for the explosion in unemployment Australia is facing. They are living in fantasyland!

So is the Transport Workers Union, which by the way is the official taxi driver union.

In a speech on digital disruption and the ‘uberisation’ of jobs, delivered on 11 December last year to a select group of journalists in the office of Maurice Blackburn Lawyers in Sydney by the national secretary of the TWU, Tony Sheldon, he demonstrated how delusional he and his union have become. He fantasised that the movers-and-shakers of the digital revolution (like Uber) would become good corporate citizens paying their fair share of taxes and treating their workers well if only we had a Labor government in Canberra. Apparently he also believes he can unionise UberX drivers. I quote:

“We need to think about how to structure that Uber payment – so that some share of the booking fee goes to annual and sick leave, and another share goes to the driver’s super”.

We all know how much effort the TWU has made to get such benefits for bailee taxi drivers in the 30 something years it has been our official industrial representative. Except for the now aborted case in the NSW Industrial Relations Commission, the answer is zilch, zero, nix. It has been conspicuous by its absence from government negotiations, taxi driver meetings and media commentary about Uber and ridesharing. It is as if the TWU has deliberately stayed out of the debate. So too has Fair Work Ombudsman Natalie James despite recently telling Fairfax Media, ”Frankly, I’m sick and tired of seeing case after case of employees being paid $10 or $12 an hour”. She was talking about the exploitation of 7-Eleven staff and fruit pickers. Bailee taxi drivers are not even on her radar.

The legal minimum wage is $16.87/hr for a 38-hour week ($641) plus overtime, penalty rates and entitlements. A full-time bailee cabbie will struggle to average just the hourly rate over a year once he subtracts GST and expenses. And that’s not for a 38-hour week, that’s for 50 to 60 hours of hard slog. Thousands are driving longer hours to make ends meet. The Fair Work Ombudsman may be fed up with seeing employees being paid $10 or $12 an hour at 7-Eleven but she is about to see a workforce of more than 50,000 bailee taxi drivers earning even less. Not that anyone gives a damn!

Fairfax journo, Adele Ferguson, in an article dated 26 March 2016 and headed “Worker exploitation is a national disgrace” wrote that in the quest to offer customers cheaper prices and services – and KPIs focused on the bottom line – there has become a race to the bottom. She was talking about people on 457 visas and holiday and student work visas. Evidently workers in the old taxi industry, mostly Australian citizens and permanent residents do not invoke the same sympathy in the media as do foreign guest workers.

There is something rotten in the national psyche in Australia when we fail to recognise that the Uber-style digital revolution is spawning a whole new class of disenfranchised workers. It’s ‘goodbye Fair Work Australia’ and ‘hello WorkChoices II on Steroids’. •

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OZ Cabbie February 2017

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