Digital Facade Shields E-hailing Companies from Accountability to Drivers or Passengers

E-hailing drivers working on the platforms Uber, Bolt, InDriver and DiDi brought services to a near standstill during a three-day strike in major cities in South Africa last week, protesting the precarious and exploitative conditions of their work. The strike took place from 22 to 24 March, beginning in Gauteng and expanding to Cape Town and Durban. The organisers – a group called Unity in Diversity – mobilised drivers for an app “switch-off”. This was accompanied by protests calling for fair remuneration and better security. 

The strike also represents the frustration of some drivers following years of engagement with the Gauteng Government. Ahead of the recent action, Unity in Diversity took a number of complaints and demands to Gauteng Transport Minister of the Executive Council (MEC), Jacob Mamabolo. Their demands were neither new, nor was this the first time that e-hailing drivers have gone on strike in South Africa. Meetings took place with Mamabolo last year on the same issues. The demands revolved around a lack of government regulation and enforcement in the sector, which leaves drivers vulnerable to exploitation and unsafe working conditions. 

Striking drivers emphasised that their earnings were unpredictable, and often didn’t cover their operating expenses amidst the increasing commissions taken by the platforms, as well as rising fuel prices. As Melithemba Mnguni, a protester and convener of Unity in Diversity, was quoted: “We are against exploitation and uneconomic prices that are imposed on us by app companies. The app companies determine our prices against operational costs then downgrade our cars and still charge us exorbitant commissions of 25% to 26%.” 

Drivers also pointed to safety issues they face on the job, including the threat of robbery and hijacking – exacerbated when cash trips are offered (as passengers cannot be verified beforehand). Although there were some reports of intimidation of drivers who didn’t join the strike, the organisers of the strike condemned any violence, saying it was not part of their protest. 

In focus groups with workers on e-hailing and delivery platforms conducted by RIA last year, workers generally agreed that their working conditions were exploitative and often unsafe. However, many were afraid that even speaking about them might jeopardise their income, and that increased regulation of their working conditions might result in platforms like Uber and Bolt withdrawing from the South African market, and stripping them of their only livelihood.

Many experience a profound sense of precarity – and this sense was heightened amongst the large proportion of platform workers who are migrants. With research conducted between lockdowns last year, and in the broader context of South Africa’s unemployment crisis, many platform workers felt that their tenuous income was better than nothing. But while RIA’s research revealed a range of views amongst workers about whether and how to exert their collective power, it also revealed the extent of the power platforms wield relative to their workers in South Africa. 

The platform model: Management at arms’ length

As a digital labour platform researcher, one thing that also stood out to me during the strikes last week was the scale of disruption it caused to South African cities. While many disgruntled passengers took to social media to blame and castigate drivers who participated, for me this showed two key things: First, the extent to which we rely on international e-hailing apps as a cornerstone of our transport infrastructure; and second, the general absence of the platform companies from policy and labour relations dialogue, and from civic life in general, despite their enormous influence.

This is not unique to e-hailing in South Africa, but characteristic of the model of digital labour platforms globally. Platforms aim to enrol many users, and capture as great a market share as possible in the shortest possible space of time. That’s why when platforms enter a market their prices are often very low, both in terms of what they charge to clients, and the fees they take from workers. Eventually after they have achieved a certain market share they can increase the commission they take from workers, put their prices up for customers, or both. They can take advantage of competition between workers, which facilitates a race-to-the-bottom in pay and labour standards. In a country like South Africa where there is a huge supply of surplus labour (due to our unemployment crisis), platforms are able to sign up an oversupply of workers very quickly. 

Meanwhile, despite the high commissions the platform companies take from each transaction, their operating costs are miniscule. They tend to own very little, if any, physical assets in the places they operate, such as cars, buildings, and mobile connectivity infrastructure. They aren’t subject to many taxi and transport regulations – claiming to be technology companies rather than transport companies – and they also don’t contribute directly to road maintenance. 

If they decided to exit the South African market, they could do so with very little cost or difficulty – and regulators know it. Moreover, they are set up as legal entities in far away places, making it more difficult for them to be accountable in the South African courts. For instance Uber B.V., a subsidiary of Uber, contracts with South African drivers, and is a limited liability company incorporated in the Netherlands.

They are also very adept at avoiding regulatory costs, including those associated with employing people, such as minimum wage, unemployment insurance, statutory sick pay, and maternity leave. They do this by classifying their workers as independent contractors rather than employees. Most platforms claim this gives workers flexibility to be their own boss, with some referring to their workers as “partners”. But this is where our labour law just isn’t equipped to deal with the nuances of digital governance and algorithmic power – when a boss looks like an algorithm and not a human.

Algorithmic control is not a “partnership”

The project I work with, Fairwork, is a network of digital labour platform researchers in 27 countries, including South Africa, via a collaboration between the Universities of Oxford, Manchester, Cape Town and the Western Cape. Fairwork tracks working conditions on platforms against a series of decent work principles and publishes annual ratings across the countries we work in. Since Fairwork’s first report in 2019, no e-hailing platform has scored more than 5/10 in our ratings in South Africa. 

Even though platform workers are nominally independent, in reality they are subject to methods of digital control which reduce their agency and institute a relationship of subordination with platform companies. Drivers on Uber, Bolt and DiDi don’t set their rate, and as gig workers they have no way of knowing what they might earn in a day (especially if the platform gives customers unexpected discounts and incentives). They are surveilled and disciplined by platforms, including through ratings systems. They can have their accounts blocked or terminated instantly and without recourse, losing access to their livelihood – and many do. They aren’t protected by health and safety regulations, or other provisions of the Basic Conditions of Employment Act.

As fuel prices and platform fees increase, most drivers have little choice but to work for longer and longer hours, competing with other drivers for relatively inelastic demand from passengers. For women workers who carry a higher burden of unpaid care and domestic work, this pressure to work longer hours is even less tenable, making it more difficult to compete with their male counterparts. Women are often attracted to platform work because they need flexibility. Yet this is often revealed not to be the reality. RIA’s recent research on working conditions in the South African platform economy uncovered marked gender inequities within and between sectors.

I believe that it is difficult for anyone who makes use of e-hailing services to make the sincere case that the relationship between those who labour under the direction of the app, and the app company (whether in California, the Netherlands, Estonia, Beijing or New York) is one of partnership rather than control. It was on this basis that the UK Supreme Court ruled in a landmark case last year that Uber drivers were workers for Uber, with attendant workers’ rights, and not self-employed. Similar litigation may be on the cards in South Africa, with a coalition of law firms – including Leigh Day, the firm that represented the UK Uber drivers – announcing plans to launch a class action to assert Uber drivers’ labour rights.

But workers face high barriers to holding platforms accountable in court. Because they are classified as independent contractors, they are not easily able to form or be represented by traditional unions, typically only available to employees. E-hailing drivers and food couriers have largely organised through WhatsApp groups which are used for sharing information and mutual support. But the platforms atomise the workers, cast them into competition, and make it difficult for them to meet and build solidarity. 

Strikers in Gauteng fought back against this last week by subverting the digital tools of the platform: they ordered rides to the picket line, and when drivers arrived, talked to them about the reasons for the strike, encouraging them to join. 

The role of government

In an interview with eNCA last Friday, Mamabolo acknowledged a number of the striking workers’ concerns, including their lack of recognition as workers by platforms, the safety issues they face, their precarious pay, and their barriers to unionisation. He repeatedly referred to forthcoming amendments to the National Land Transport Act, which will recognise e-hailing in the transport framework and allow the Transport Minister to regulate the sector. The Bill was passed by the National Assembly in March 2020, but awaits approval from the President. 

However, it is difficult to see how this could tackle the wider issue of employment misclassification of platform workers in the transport sector and beyond (in food delivery, domestic work, etc.), in the absence of labour law reform. Mamabolo also said that mediation was ongoing between workers and platforms, though he expressed frustration that platforms had not meaningfully participated: “If an e-hailing company doesn’t cooperate with us, can they operate in this province? So they can ignore us at their own peril, but for now … we are calling on everybody to go to the mediation process.” This tone of exasperation has characterised many of Mamabolo’s statements over the week of the protests, directed at absentee platforms which have nevertheless insinuated themselves into our urban transport systems in such a way that their power is undeniable.

The government has understandably placed high hopes on digitalisation and the “fourth industrial revolution” to drive growth and job creation in South Africa, with President Cyril Ramaphosa establishing a Presidential Commission on the subject. But the utopian veneer of digital efficiency and libertarianism that accompanies e-hailing apps may be starting to fade. Rather than triggering a virtuous cycle of economic empowerment and innovation, it seems clear that these companies have used their digital tools to extract rents from the South African transport sector and exploit workers without giving much back in return.

The key lesson from this must be that inclusive growth doesn’t automatically flow from digitalisation. Digitally driven development must be sensitive to local needs and context, include the participation of all stakeholders, and make a contribution to tackling South Africa’s long-term challenges. As we learned from RIA’s research with platform workers last year, many are not structurally supported or empowered to assert their rights, and face a level of precarity that makes striking a very scary prospect.

Platforms can and should be accountable to workers’ demands for fairer pay, contracts and conditions. But ultimately, many are able to avoid responsibility due to a lack of enforcement and responsive regulation from the government. That’s why the striking workers directed their demands solely towards government officials last week. 

Speaking to the media, another spokesperson for the workers, Vhatuka Mbelengwa, said: “We will confront the Presidency to say, ‘Mr President Cyril Ramaphosa, when you campaigned for office you promised us new opportunities that will emerge from the fourth industrial revolution, you have given us a nightmare, you have handed us over to global exploitative companies. How long will you remain silent on this matter?’”