Uber faces collective legal action over AI-powered pay systems

Uber is facing a proposed collective legal action over its AI-driven dynamic pay systems, with a non-profit foundation alleging that the technology lacks transparency and breaches data protection laws. The Worker Info Exchange (WIE) International has issued a legal letter before action to Uber BV in Amsterdam and Uber Technologies Inc. in the United States on behalf of drivers across the UK and Europe, and the foundation stated that it is also examining Uber’s pay systems in other European markets and may widen the claim to additional countries in due course.

As per a report by Mint, the organisation said the case is not only about financial fairness, compensation and redress for drivers but also about ensuring transparent, fair and safe working conditions for all platform workers. James Farrar, Chair of the Management Board at Worker Info Exchange International, said Uber has used artificial intelligence and machine learning to implement intrusive and exploitative pay-setting systems that have damaged the livelihoods of thousands of drivers, and he added that collective action is intended to secure a fairer deal for drivers and hold Uber financially accountable for harm caused by what the foundation considers an unlawful use of AI.

WIE International further alleged that Uber breached the EU’s General Data Protection Regulation by unlawfully transferring driver data from Europe to the United States between August 2021 and November 2023, exposing personal information to risks of unauthorised access and potential US government surveillance. The group stated that the company is using drivers’ personal data and profiling to train the same algorithm without their consent.

The transparency and fairness advocacy organisation warned that it plans to bring collective proceedings before the Amsterdam District Court under the Netherlands’ collective redress law if Uber does not cease these practices and compensate affected drivers. Research conducted by the University of Oxford in collaboration with the foundation indicated that 82% of Uber drivers in the UK are earning less per hour following the introduction of dynamic pay, with reported losses of between 8% and 16% over the past year.