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Alex Rosenblat is the author of Uberland: How Algorithms Are Rewriting the Rules of Work and senior researcher at the Data & Society Research Institute.

It’s easy for a prospective Uber driver to start working in the gig economy. They download the Uber driver app onto their smartphone and click “Yes, I agree” to the terms of their employment. If Uber approves the documentation they submit, such as a driver’s licence, it activates their account so they can start earning money.

Consumers routinely click through lengthy form contracts to access services quickly, with no opportunity to negotiate them. But the terms can contain some nasty surprises.

David Heller, a former Uber Eats driver in Ontario, tried to sue Uber in 2017 for misclassifying drivers as independent contractors, rather than employees, in a proposed $400-million class action. But technically he had clicked “I agree” to resolve all legal disputes with Uber through individual arbitration proceedings in the Netherlands, which meant he wasn’t able to pursue his claim collectively through a class action.

The hidden details also made it almost impossible for him to arbitrate anything on his own; even if his claims amounted to a few hundred dollars, he would have to pay upfront costs of US$14,500 before he even hired a lawyer or booked a flight to Amsterdam. Mr. Heller’s income was $400 to $600 a week before taxes and expenses.

On Friday, the Supreme Court of Canada upheld a ruling by the Ontario Court of Appeal. It decided that Uber’s harsh arbitration terms are unconscionable and invalid, partly because of the vast inequality of bargaining power between a multibillion-dollar global company and a lone driver.

The lower court also established that Uber’s arbitration clause unlawfully contracted out provincial labour laws, as law professor David Doorey observes. If Uber drivers in Ontario are reclassified as employees or dependent contractors, such as Foodora couriers, they become eligible to unionize and potentially increase their bargaining power.

The effective control Uber has over the terms and direction of drivers’ work is at the heart of the misclassification lawsuit that Mr. Heller is now free to pursue under Ontario’s Employment Standards Act. For example, Uber unilaterally controls and frequently changes the rates at which drivers earn their income. The Uber app periodically asks drivers to accept new terms and conditions before being allowed to drive. One U.S. driver recalled squinting at the small text on his phone and noticing that Uber had increased its commission on his fares from 20 per cent to 28 per cent.

Since 2014, I have interviewed and observed hundreds of Uber drivers on the job across more than 25 cities in the United States and Canada. Uber markets drivers as entrepreneurs who can be their own bosses, but I found that drivers do have a boss – an algorithmic one.

The power of an algorithmic boss is harder to see, but it monitors drivers’ performance, such as how harshly they brake; communicates expectations with helpful hints, to avoid the appearance of direct supervision; disciplines them with temporary or permanent deactivations; and withholds key information that drivers need to make entrepreneurial decisions. For example, when Uber’s algorithm dispatches ride requests to drivers, it hides the passenger’s destination; before starting the trip, drivers can’t evaluate if the job will be profitable and are penalized if they cancel it.

Drivers appreciate the flexible hours (which is often conflated with independence), and some prefer working for Uber because it feels freer than being told what to do by a human supervisor. The company could increase drivers’ autonomy by, say, letting them set their own rates. Instead, Uber counters accusations that it misclassifies drivers with persuasive rhetoric.

It uses wordplay as a liability shield to say that what drivers do – transporting Uber passengers from A to B – is not its core business as a tech company. And it argues that drivers are merely consumers of its technology app, much like passengers. The virtue of this technology narrative is that it produces doubt about the evident employment relationship between Uber and its drivers. While Uber has largely succeeded in treating drivers as independent contractors in the U.S., except in states such as California, that strategy faltered in Britain and France.

If Mr. Heller’s suit is certified as a class action, and if drivers are found to be employees, they would become entitled to the benefits of formal employment, such as vacation pay and the minimum wage. For now, the court decisions in Mr. Heller’s case support the democratic norms of fairness in a gig economy that has often evaded the rules of law through systemic misclassification.

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