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An Uber executive has warned that Brussels’ proposal to designate gig workers as de facto employees would force the closure of its ride-hailing services in hundreds of EU cities and increase prices by up to 40% if implemented.
Anaabel Díaz, Uber’s head of operations in Europe, urged lawmakers debating the EU’s platform work directive this week to approve rules to preserve what she said were self-employed workers’ desire for flexibility.
“If Brussels forces Uber to reclassify drivers and couriers across the EU, we expect the number of job opportunities to decrease by 50-70%,” Diaz said. She added that this would cause Uber to cease its current operations It operates in “hundreds” of the 3,000 cities across the European Union it serves.
Diaz added that new laws giving drivers full working rights would also force Uber to raise the prices consumers pay. “According to the European Commission’s own estimates, this could increase prices for consumers in major cities by up to 40%, and with fewer drivers available, waiting times for passengers could be significantly longer.”
Her comments come in a week when the EU’s main institutions – the European Commission, Parliament and Council of Ministers – have launched negotiations on the final text of a new law aimed at improving economic conditions for gig workers in the bloc. group.
The law could represent a significant change from the status quo in Europe, where most platform workers are considered self-employed, meaning they do not have access to labor rights and benefits such as paternity leave and the minimum wage.
In an interview with the Financial Times, Diaz warned of the consequences of proposed EU legislation that would give digital platform workers, including ride-hailing service drivers and food delivery drivers, full-time worker rights by default.
She said Uber was “sincerely committed to the European social model” but warned that similar rulings in Spain and Geneva classifying drivers as employees had led to “devastating” job losses.
“To manage employment costs, Uber will be forced to consolidate the work hours of fewer employees,” she said. “Drivers and couriers are required to apply for an open position if one becomes available; work shifts at specific times and locations; accept every trip they receive; and agree not to work on other apps.”
However, Diaz denied that the legal change would affect Uber’s profitability in Europe. “This has nothing to do with Uber’s profits,” she said. “We have demonstrated our ability to leverage a third-party employment model to achieve growth in places like Germany and Spain.”
In Germany, Uber contracts with fleet management companies, who hire drivers in order to operate within local rules. Uber said its prices in Germany are therefore higher and its ride-hailing services are only available in major cities where it expects steady demand.
In the UK, following a high-profile court ruling in 2021, Uber has adopted a different operating model: its drivers are designated as “workers” and are entitled to benefits such as holiday pay and sick leave, but do not have full employee status.
While rivals in the industry, including Uber and Bolt, have sounded the alarm over proposed rules for platform workers, EU officials have pushed back against what some see as lobbying tactics by the tech industry.
At the launch of the EU proposal, EU Commissioner for Employment and Social Rights Nicholas Schmidt said: “This is about establishing clear standards and looking at the facts. If the platform is in fact an employer, then people who work for it are entitled to the same benefits as Same rights and protections for workers in the ‘offline’ world.”
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