Uber is rolling its name-your-price feature out to drivers in San Francisco, Modesto, Santa Barbara and San Luis Obispo in an effort to "further increase drivers’ flexibility and protect access to independent work," according to a blog post.
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The name-your-price feature allows Uber drivers to set their own fares, from as little as half to as much as five times the ride-hailing company's standard time and distance rates. Drivers can set fares based on 10 percent increments or they can use Uber's standard default rate.
Riders will be notified if they are matched with a driver who sets their fare higher than the upfront estimate, similar to the notices they get about surge pricing during times of high demand, according to the company. Riders will be given the option to either accept the fare or decline it and search for a new driver in their area.
The company previously rolled the feature out back in January at smaller airports in Santa Barbara, Sacramento and Palm Springs.
The move comes in an attempt to show that Uber drivers are independent contractors, and should not be classified as employees under California's Assembly Bill 5 law.
The law requires companies to identify independent contract workers as employees under certain requirements so that they can be entitled to standard state benefits such as workers' compensation, minimum wage pay and overtime pay.
California Attorney General Xavier Becerra filed a filed a lawsuit in May, suing Uber and Lyft for "misclassifying" drivers as independent contractors instead of employees "in direct contravention of California law."
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Becerra has criticized Uber and Lyft for not offering benefits like sick leave and overtime pay, and he wants to ensure that drivers are classified as employees so that they can be given basic protections.
"Californians who drive for Uber and Lyft lack basic worker protections — from paid sick leave to the right to overtime pay. Uber and Lyft claim their drivers aren't engaged in the companies’ core mission and cannot qualify for benefits," Becerra previously said in a statement. "Uber and Lyft drivers who contract the coronavirus or lose their job quickly realize what they're missing. But it’s not just these workers who lose. American taxpayers end up having to help carry the load that Uber and Lyft don’t want to accept. These companies will take the workers’ labor, but they won’t accept the worker protections."
The California Supreme Court ruled in 2018 that companies must use a three-pronged test to determine whether to classify workers as employees or independent contractors.
But Becerra believes that Uber and Lyft "simply don't pass the test", and he is willing to take them to court to "get these employees what they deserve."
In order for Uber drivers to be exempt from the law, the company must prove they are "free from the control and direction of the hiring entity in connection with the performance of the work, both under the contract for the performance of the work and in fact."
They also must prove that drivers are performing work "outside the usual course of the hiring entity’s business" and are "customarily engaged in an independently established trade, occupation, or business of the same nature as that involved in the work performed."