
Uber drivers file class-action suit over tips - ubasu
http://www.sfgate.com/business/article/Uber-drivers-file-class-action-suit-over-tips-4778315.php
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enneff
I hope Uber can succeed in taking a stand on this. Tips are terrible for both
consumers and workers; the only beneficiaries are the employers, who get away
with underpaying their employees. And most of the world agrees. Why is North
America so slow to realise this?

~~~
IvyMike
Tips give the server a motivation to get customers served and out the door
faster: The chance to work more customers and thus acquire more tips.

This is obviously good for the employer but may also be good for the consumer,
if they are in a hurry.

~~~
rictic
This is an empirical claim: namely that tipping results in better service.

The evidence I have seen does not favor this hypothesis:
[http://freakonomics.com/2013/06/03/should-tipping-be-
banned-...](http://freakonomics.com/2013/06/03/should-tipping-be-banned-a-new-
freakonomics-radio-podcast/)

~~~
IvyMike
I don't see anything in that link or the transcript that actually addresses
this point.

(Note that I limited my claim to "faster service", not overall "better
service" or "perception of better service".)

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jrockway
I don't understand why this is an issue for the courts rather than one for the
market. If you can make more money not driving for Uber, don't drive for Uber?

~~~
Noxchi
These workers could have ties with taxi companies (and they're being paid to
bring on the lawsuit), or they want to take advantage to get more money.

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lifeisstillgood
I am amazed by the well, anti-union, line being taken here.

Über is just trying to break into a regulated industry - and that means
breaking regulations.

Regulations are usually what is imposed after the fight is over - and taxis
have gone thru a long period of controversy, legal disputes and often criminal
behaviour to get where the regulations are now.

Über will cause some change (285m will guarantee that) but in the end there
will be new regulations cementing the status quo. And since everyone realises
there will be a new status quo, everyone who has a brain will pile in now and
make sure their slice of the pie is as big as possible at the end.

Über does not deserve to win just because it started the fight.

~~~
hershel
I agree with you. Uber doesn't deserve to win just because they started the
fight.

But Uber toghter with Google, have the potential to dramatically change how
transportation is being done.

They could start a shared taxi/van service on demand which at that scale could
compete with cars on price and performance(at least according to some
researchers and the finish kutsuplus public transportation service).

But in order to try that, at least some regulations should be revoked, at
least temporarily.

Of course, that doesn't mean user should cheat drivers out of wages.

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badass
People love Uber because it's disruptive and it's better than taxis. But, the
future is not Uber. The future is any car owner becoming a taxi. I have a
ride; you need a ride. Why shouldn't this be? There can be services that track
reputations of both drivers and passengers and travel arrangements can be
taken care of through a central service as well. Taxi monopolies are archaic
and need to die. Uber is a transitional service but it is certainly not the
final answer to the current way of things.

~~~
eksith
That can be both good and bad. Good because you get a ride very quickly. It's
bad because you have no idea...

    
    
      * Who your driver is
      * How long h/she's been driving
      * If there's a camera in the taxi (for your own protection)
      * Whether that's being monitored or just disconnected
      * How well the car is being maintained
      * Whether the driver has insurance and actually knows how to get to your destination
      * Whether h/she's from New Jersey (I kid, I kid... mostly).
    

Taxis are regulated, ideally, for this reason. I think drivers should have the
right to apply to become a taxi driver, but then they have to maintain certain
standards -- especially safety, competence and fee structure -- or what we end
up would be an order of magnitude worse than what we have.

~~~
mtrimpe
The future is actually externally-verified personally signed data systems,
which could cover most of these fairly easily.

~~~
omd
This already exists. It's called a taxi company.

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brianmcconnell
I have a lot of friends who work in the service industry. All of them complain
about their tips being skimmed off credit card transactions by the owner.
Every single one.

Tips = Commission. Stop conflating it with a bonus for kissing your ass. It's
an incentive to hustle and get orders filled.

~~~
venus
Don't understand this attitude at all.

Tips are nothing but a demeaning way to tell low-status workers that the value
of their time is arbitrary and their livelihood is always subject to whim. Do
you tip your doctor? Do you tip anyone with a high-status job? Of course not.

Tipping should just be abolished. Set a price and charge it. Pay people fairly
and consistently so they can feel secure and plan for the future. Anything
else is just sneaky.

~~~
brianmcconnell
I guess you don't get out much, or haven't run a service business. The concept
is variable cost of labor. If you're a bartender working a busy shift, you can
pocket several hundred dollars off dollar a tip drinks.

What do you think would happen if tips were abolished? The owner would
increase their wage a tiny bit. Who do you think will be working that job
then?

~~~
jbjohns
What an ignorant statement. Europe doesn't have this ridiculous tipping
culture (parts do tip, but usually $1-$2 max) and yet we fill those positions.
Surprisingly enough, if you pay someone a living wage for doing a job they
tend to do it well.

~~~
brooks8970
He was making the point in the context of an american business making the
decision not to accept tips. No server in their right mind would work for
minimum wage and no tips when they could receive $1/hr + tips at a busy
restaurant down the street. My guess is that most service industry jobs in
European countries attract people with lower financial needs relative to their
fellow citizens.

~~~
vacri
From my travels across the US, it was abundantly clear that not all
restaurants and bars were busy, even in prime time.

It's pretty easy to see whether or not service is a well-paid job: do high-
status people do it, and do people make a career of it (in general). And the
answer is no. people do it when they're young and can't do anything else, and
it burns them out. Few people stay in service. Yes, you can cherry-pick some
good jobs out of service, but in general, people do it because they can't do
something else... or do it _while_ doing something else (like study).

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error54
I've noticed many companies have this "tips included" built into the price
which I think is a poor practice. Tips are supposed to be a way to reward
excellent service and incentivize the employee to work hard. Having worked in
a restaurant for 6 years I always tip well but I can say that honestly, I've
had several experiences where the person didn't earn a tip. If you're going to
include tips into the price, just pay them a flat salary and be done with
because a mandatory tip isn't a tip at all, it's a surcharge.

~~~
jbjohns
All a tip is is employers tricking you, their customer, into paying their
personnel costs (often upwards of 4/5ths of it!) directly. You don't
"incentivise" someone to work hard by paying them the money they're actually
owed by law [1].

[1] In the US, restaurants don't have to pay minimum wage unless the tips
don't reach minimum wage (in which case, the company will make up the
difference and then fire the employee for performance). The worst I've heard
of was a working in an $8/hr state getting $1.20/hr.

~~~
timdev2
You'll be paying those personnel costs either way. In a tipless society, your
entree would just cost more, and the server would get their hourly regardless.

People like servers and drivers have an opportunity to provide extra value
beyond their purely mechanical function. A culture of tipping allows the
consumer to reward that extra effort, at their option.

That said, I do agree that 15-20% as a tip for 'standard' service is just
silly. If I owned a restaurant, I'd want to hear about it if a customer was
unhappy. When the customer can just stiff the server on their tip and leave,
it gets harder to identify which workers need retraining/replacement.

~~~
Trezoid
> In a tipless society, your entree would just cost more

I live in a tipless society. Things cost exactly the same here (in Australia)
as they do in the US. Difference is we don't have to pay extra on top of the
meal.

We also get paid far _far_ more. Minimum wage over here, in fast food, is $20
an hour.

~~~
objclxt
> _Things cost exactly the same here (in Australia) as they do in the US_

That's not true. The cost of living in Australia is considerably higher than
in the US. Melbourne and Sydney are both in The Economist's Worldwide Cost of
Living top 10 (no US city is)[1].

Looking at food specifically, in 2011 one litre of milk was on average $2.21
USD in Australia, and a 1kg loaf of bread $5.24 USD.[2] In the US they were
$1.80 and $2.80[3]. Half the price.

> _Minimum wage over here, in fast food, is $20 an hour._

It's actually around $15 per hour. It varies a little with age[4][5]. Still
quite high though. I'm not saying food prices necessarily directly connected
with the minimum wage, just refuting the idea that in Australia food is the
same price as the US. It simply isn't!

[1]:[http://www.cfoinnovation.com/system/files/worldwide%20cost%2...](http://www.cfoinnovation.com/system/files/worldwide%20cost%20of%20living%202013.pdf)
[2]:[http://www.liveinvictoria.vic.gov.au/living-in-
victoria/cost...](http://www.liveinvictoria.vic.gov.au/living-in-
victoria/cost-of-living/cost-of-food-and-groceries)
[3]:[http://data.bls.gov/cgi-bin/surveymost?ap](http://data.bls.gov/cgi-
bin/surveymost?ap)
[4]:[http://www.theatlantic.com/business/archive/2013/08/the-
magi...](http://www.theatlantic.com/business/archive/2013/08/the-magical-
world-where-mcdonalds-pays-15-an-hour-its-australia/278313/)
[5]:[https://www.fairwork.gov.au/pay/national-minimum-
wage/pages/...](https://www.fairwork.gov.au/pay/national-minimum-
wage/pages/default.aspx)

~~~
venus
Service sector workers are most likely casual (ie not permanent part or full
time) and thus their minimum wage is AUD$20.30/hr [1]

Tipping the scales further against America is that they are also fully covered
by the national health insurance system, Medicare.

That said, it's hard to directly compare Australia and the USA - there's just
too many variables. You are correct in that food is a little cheaper in the
States; not 50% but probably 30% cheaper on average, from experience. Rent,
too, is higher in Australia.

All things considered, though, I think it's pretty inarguable that a service
sector worker is going to have a higher income and better quality of life in
Australia. That's a consequence of deliberate economic policy. It's not
without its negatives, of course - service hours in Australia are much less
than in the USA, and certainly a factor in that is the higher cost of staff.
For example, there is not a single 24-hour supermarket in Sydney!

[1] [https://www.fairwork.gov.au/pay/national-minimum-
wage/pages/...](https://www.fairwork.gov.au/pay/national-minimum-
wage/pages/default.aspx)

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philip1209
The system seems completely transparent and unequivocal. If contractors sign
up knowing that there are no tips, then there is no logical reason for them to
expect tips.

~~~
danmaz74
On the contrary, if the customer is told that the tip is included, but then
half of that money goes to Uber itself - that's completely not-transparent and
equivocal.

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revelation
Why can you sign away your right to legal recourse in some contract, one that
you sign on your phone with a swipe of a finger? That's ridiculous.

