Uber’s past ghosts are still chasing the company, and the recent revelations exposing how top politicians secretly helped Uber to grow may have consequences beyond reputational damage.
On Sunday, July 10, The Guardian revealed thousands of leaked files explaining the extensive help Uber got from leaders such as Emmanuel Macron and ex-EU Commissioner Neelie Kroes. The Uber files are a trove of more than 124,000 records, including 83,000 emails and 1,000 other files, spanning 2013 to 2017.
The information revealed how a $90 million-a-year lobbying and public relations efforts recruited friendly politicians to help in its campaign to disrupt Europe’s taxi industry.
Perhaps two of the most striking revelations refer to Emmanuel Macron and former EU Commissioner Neelie Kroes. The then French minister for the economy allegedly helped Uber to change the regulatory framework for ridesharing to allow Uber to operate in the country. According to the files, Uber lobbyist Mark MacGann described a meeting with the French politician as “spectacular.”
The files also revealed that former EU Commissioner for digital affairs, Neelie Kroes, collaborated with Uber earlier than previously known, which could be in breach of rules governing commissioners’ conduct. Kroes was appointed as a board member when she ended her term at the European Commission, but she may not have respected the cooling-off period. The relationship between Kroes and Uber was so secret that an internal email from Uber advised the staff not to discuss her informal relationship externally. “Her reputation and our ability to negotiate solutions in the Netherlands and elsewhere would suffer from any casual banter inside or outside the office,” read the email.
It is still unclear how these and other revelations may affect the company´s image or its licenses to operate in some countries, but it is likely that this scandal would give more ammunition to the European Commission and the EU parliament to pass new rules for gig workers.
Uber says its “past behavior wasn’t in line with present values” and it is a “different company” today.
The European Union announced in December a legislative package with proposals to improve the working conditions of people using digital labor platforms. The proposal includes a reclassification of certain gig workers as employees. It would also require that digital platform companies like Uber give up some control over workers to make them truly self-employed. If reclassified as employees, workers would be entitled to paid annual leave, collective bargaining and other benefits. The EU estimates the reclassification to employees could cost the industry as much as $5.1 billion.
Read more: EU Gig Workers Could Be Reclassified as Employees
This proposal is currently being debated at the EU Parliament, with some opposition from conservative MEP to offer full-time employee status to gig workers. The proposed text has received a barrage of amendments in the parliamentary committee, which suggest that a final position may not be reached soon. However, some of the compromises have emerged under Emmanuel Macron’s supervision and may now be put into question after the recent revelations. For instance, he rejected the full-time status and proposed a new form of social dialogue between the platforms and the workers. He also authorized the creation of a new Authority for Social Relations of Employment Platforms in 2021.
While the proposed legislation is not only about Uber, it was the company’s business model that triggered the discussions. Thus, EU policymakers may use this opportunity to make sure that there are not regulatory gaps in the upcoming directive that can be exploited by companies.
The reputational damage may also have a regulatory impact for Uber. Meta (formerly Facebook) gained a reputation in Brussels for misleading regulators when it provided inaccurate information in the Facebook-WhatsApp merger review. Arguably, this reputation has increased the regulatory scrutiny over each of the company’s next moves, whether it was another merger or the issuance of a stablecoin, making the journey through the EU institutions more difficult.
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