Legal

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This Blog is written by Paryas Khosla from Vivekananda Institute of Professional Studies (VIPS), Delhi. Edited by Ritika Sharma.

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INTRODUCTION

Uber Technologies, Inc. is an American based company which involves multinational ride-hailing works, it is known as ‘Uber’, and this name is very common. This company is involved in peer to peer ride-sharing services to individuals, this company is spread among many countries; it emerges as the main company for riding and delivery services. This technology was started in the year 2009 from the developed countries; now it is available almost in all the big cities of the various countries. The owner of Uber is Travis Kalanick. This service has helped in generating numerous employments in many countries and also in our country, there are about a total of 30 million people working with Uber. The basic theory behind Uber is to outsource riding and delivery facilities to people scraping the old method of riding or rented taxies to people. Now, these taxies are famous for the term of cabs.

In May 2019, the United States Labor Agency on the direction of the President of the United States made a report on clearing the doubts of the people whether the Uber drivers are contractors or employees. It was said that drivers working with Uber are contractors, and they are not the employees of the Uber because Uber drivers set their hours for work, they own their car for driving, and they only follow the directions. Also, many state bodies and district court stated that the drivers cannot be considered as the employees. After this the issues were raised that there is no job security for the drivers, they work so hard, and also the company is getting more benefits from them and in return, they are not even getting much in comparison. There were huge protests in the United States regarding this. The Uber Drivers said that the company is getting more benefits but the per hour wage is less as compared to the earning, there were many more issues like who will provide insurance to them, etc. Similarly, there was a PIL filed in the Delhi High Court. So, this whole issue confused the drivers working for Uber and these confusions were cleared by the Uber company in many ways.

SIGNIFICANCE OF THE DEVELOPMENT

India is one of the leading developing countries, which has the second-largest population in the world, and also our country has massive unemployment. 45% of the total population is youth, so, this unemployment has many disruptive consequences. So, this outsourcing business has played an important role in employment generation. We can see the facilities like Ola and Uber in our metropolitan cities such as Delhi- NCR, Bangalore, Kolkata, Mumbai, etc., and as well as in small towns also. These companies are playing an important role in the mobility of people from one place to another, they contribute in our economy in large amounts. After the increase in the demand for this facility, it has also raised many concerns such as the security of the driver, his insurance, etc. Before this, there is much confusion regarding the status of the driver whether they are employees of the company or are they the contractors. These drivers consider themselves as their employees though they are the independent contractors. The reasoning given by them is that they are contributing to the economy of both the company and the government. They get their customers on the discretion of the company; they pay some part of their per trip earning to the company and also, they give some part of their earning as a fixed charge. They work at the direction of the company; they take the direction of how a boss gives instructions to its employees. How people in multinational companies consider it as a lifeline. They have become an important part of our lives. People are living a different life full of difficulties, anxiety, stress, burden, and shortage of time. So, these cabs play an important part but, these drivers expect some kind of job securities as employees from the employers, who is going to resolve this problem?

IMPACT

A number of people joined these jobs due to the increasing unemployment and with the hope to earn from the opportunity but they left because of poor working conditions and fewer earnings. This opportunity of cab service has resulted in a massive increase in the automobile sector earlier but now we have seen how the automobile sector has gone downhill. People purchase cars on EMI; they spend their savings on this after due to less pay and then they end up selling the car and paying the installments. This is due to the lack of job security, we know that most of the world’s road accidents occur in India; so, this has resulted in insecurity amongst the drivers who will feed their family after them. Though there are many NGOs who are fighting for the rights of the drivers to get them justice, there are also some issues with some provisions such as if some process is failed unintentionally, the penalty is to be paid by the driver which might be the fault of the drivers. Also, to give the opportunity to the drivers, entrepreneurs are developing many applications for such the same facility, such as OLA. It is an Indian based riding facility, it originated in our country and its owner is Bhavesh Aggarwal. So, we need to give more opportunities to the home-made services and should promote local brands and small businesses.

CASE LAWS AND PROVISIONS

United States Labor Federation states in their report that Uber drivers are the contractors and not the employees; they work on their own, they only get the directions from the company. After this, the district court of Pennsylvania said they are independent contractors, not the employees. Similarly, in India, The Motor Vehicles Act, 1988 states that these drivers are the independent contractors, not the employees because they are working under the direction of the parent contractor and that they work in the name of the company.

In 2017 there was a PIL filed in the Delhi High Court, where the driver’s union of 1.5 lakh drivers said that though they are working with Uber, Ola but they alleged that the two companies were not treating them as employees and instead “exploiting” them. It has been claimed in its plea that the drivers were being exploited with regard to their pay and service conditions and were also being denied benefits like compensation in case of accidents or deaths while on duty, under the labor laws. The Delhi Government, during the hearing, told the court that the issue raised was either an industrial dispute or a policy decision to be taken by the administration. It said no representation has been made to it by the drivers highlighting their grievances. The Central Government, on the other hand, said a Bill amending the Motor Vehicles Act for regulating companies like Ola and Uber has been passed by the Lok Sabha. However, the petitioner, represented by the advocates Akash Vajpai and Shoumendu Mukherji, contended that the problems faced by the drivers were not covered by the proposed legislation. The union has contended that the drivers work under “deplorable working and pay conditions”. It has sought the setting up of a committee to look into their grievances and give appropriate recommendations to improve their conditions and pay. It has also sought the grant of a fixed amount as compensation to the drivers, or their next of kin, who are injured or killed due to road accidents while employed with Ola and Uber. In support of their claim that they were employees of the companies, the driver’s union has contended that Ola and Uber select a driver for a customer on their sole discretion and therefore, there is no element of freedom and independent decision making on the part of the driver. The union is also opposed to the change in the fares on a daily basis allegedly on the “whims” of the two companies and without any prior notice to the drivers. It has said that the drivers are demanding a revision in the minimum fares and restoring bonuses that were offered in the initial days. They also said that the issue of whether these drivers are employees has been decided in their favour in the USA and the UK. With regard to the recent protests by some taxi drivers’ unions against the fare system of Uber and Ola, the petitioner union has said that such agitations were held worldwide and not just in India.  There is a need to make some provisions for them in many statutes such as Workmen Compensation Act, labor laws, Motor Vehicle Act, etc., so that this sector can rise more in the economy of our country.

ANALYSIS AND CONCLUSION

Irrespective of the rules and regulations of the company we must understand that this company originated in the United States and most of the revenue which is earned by the company is gone back to the United States, so, there should be more and more usage of the Indian services. We need to become the Aatmanirbhar Indian, we are progressing in the world and we can easily solve any problems. In the matter of the drivers, we need to makes some special provisions for them. They are our contractors according to the law but we need to make their job more secure so that more and more population can join this with fewer insecurities; it is more on the government to do something.

REFERENCES

(1) Motor Vehicle Act, 1988

(2) The Times Of India

(3) The Hindu

(4) American Federation For Labour