Uber’s CEO Calls His Company a Labor ‘Safety Net’

June 24, 2016, 12:05 AM UTC
Travis Kalanick, CEO of Uber
Photo: David Paul Morris—Bloomberg via Getty Images

Uber CEO Travis Kalanick has some interesting views about his company’s relationship to people and cities its serves.

“In many ways, we look at Uber as the safety net for a city,” he said on stage at the Global Entrepreneurship Summit in Silicon Valley on Thursday.

Imagine if a factory in a town closes, Kalanick explained. Uber could provide jobs to those laid off workers.

“They can push a button and get to work,” he said of the flexibility that comes with driving for his company. “They can also push a button and stop working.”

Uber, the seven-year-old ride-hailing company that’s now worth $68 billion, has helped usher an era of companies that deliver anything from a ride to the airport to a burrito with the tap of an app. The company’s practice of using independent contractors as its drivers, which Uber argues allows them to have flexibility, has also become controversial and the subject of multiple lawsuits against the company.

Along with that flexibility of work, Uber has long resisted creating a traditional employee-employer relationship with its drivers like providing them with health insurance, reimbursing their expenses, and providing unemployment benefits. Only recently, as part of a proposed settlement for a pair of lawsuits over its classification of its drivers as contractors, has the company agreed to concessions like letting drivers form labor associations (not unions), and clarify that passenger can tip if they want to.

Uber recently partnered with a union in New York to create a driver association to represent the drivers and let them attend monthly meetings and discuss issues. On Thursday, Kalanick described the associations as a way to ensure that drivers can make their voices heard.

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But Kalanick then took his views of Uber’s altruistic work to another level: criminal justice.

“We have systems in place where if you’re arrested, you can’t find work,” he said. “These systems are often put in place, like, literally to keep people who are innocent out of the workforce.”

To be sure, most employers do, and legally can, conduct background checks and ask job candidates about their criminal histories. With that said, most states bar employers from using arrest records for hiring decisions if they did not lead to a conviction, although many allow for questions about arrests during an interview, according to Workplace Fairness, a non-profit that provides information about employment rights. In fact, California, Uber’s home state, is one of those states that prohibits asking candidates about arrests that never led to a conviction, per the state’s Labor Code.

As for those who have been convicted, Kalanick still believes there’s hope.

“What are you going to do after you’ve paid your dues?” he told his interviewer, Valerie Jarrett, senior advisor to President Obama, hinting that Uber can help those individuals earn an income and reenter their communities. This is an issue President Obama has pushed for over the years.

In January, Uber said that it would now re-consider hiring some drivers who were previously denied because of their criminal records. Under California’s Prop. 47, some people with criminal records can get their felonies reduced to misdemeanors or get their records expunged. These felonies include possession of most illegal drugs and property crimes like shoplifting and check fraud in which the loss was $950 or less.

But the irony is hard to miss. Over the years, Uber has made headlines for drivers assaulting passengers, only to be found to have prior criminal records. A year and a half ago, the district attorneys of San Francisco and Los Angeles filed a lawsuit against the company after they found that 25 of its drivers had criminal records, according to the San Francisco Chronicle. Among those drivers were convicted sex offenders, identity thieves, burglars, kidnappers, and a murder, although not all those convictions happened within the last seven years covered by Uber’s background checks. The company settled those allegations in April.

Uber has also resisted calls for it to use fingerprinting as part of its background checks, arguing that the practice is not any safer than its current practices.

If anything, Kalanick is right that “the on-demand economy can also be quite interesting on the labor side.”

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