Uber faces class action from more than 6,000 taxi drivers alleging illegal activity and “horrible losses”

More than 6,000 taxi, hire car and charter drivers are taking on ride-sharing giant Uber in what’s shaping up to be one of Australia’s largest class action lawsuits.

The case alleges Uber, a company recently valued at more than $100 billion, knew it was acting unlawfully when it entered the Australian market, and in doing so, had a “devastating impact” on tens of thousands of taxi drivers and other licence owners in Australia.

The class action is being headed up by Australian law firm Maurice Blackburn and backed by litigation funder Harbour.

“Uber came in and exploited people by operating outside of regulations and it was Uber’s conduct that led to horrible losses being suffered by our group members,” senior associate at Maurice Blackburn, Elizabeth O’Shea said in a statement.

“For those reasons, we are targeting the multi-billion dollar company Uber and its associated entities to provide redress to those affected.”

The case has been 18 months in the making, and Maurice Blackburn is in the process of encouraging more licence owners to sign up, saying there are no out-of-pocket costs. The law firm estimates there are upwards of 40,000 licence owners in Victoria and New South Wales alone.

Small-business owners have told SmartCompany in the past about their grievances with Uber — specifically, the company’s delivery arm UberEats. Business owners allege the platform’s fees are unsustainably high and offers little support to business owners.

Nick Andrianakis, a lead plaintiff in the case and a long-time taxi driver and operator from Melbourne, said in a statement his livelihood was suddenly taken away due to Uber’s alleged “illegal activities”.

“I can clearly remember the day it all became too much — I just stopped driving that day and had to go home to be with my wife. It’s a shocking thing to think of a life’s work being stripped away from you, but this is what’s happened to thousands of people nationwide,” he said.

However, in a statement to SmartCompany this morning, an Uber spokesperson said the company had not been served with a class action as of yet, despite reports suggesting the case had been filed in the Victorian Supreme Court on Friday morning.

“We understand there are media reports suggesting that Maurice Blackburn has filed a claim that will allege Uber operated illegally in Australia. Uber denies this allegation and, if a claim is served making it, the claim will be vigorously defended,” the spokesperson said.

“Over 3.8 million Australians regularly use Uber as a reliable choice to get from A to B and governments across the country have recognised ridesharing as part of the transport mix. We will continue our commitment to delivering a great experience to Australians in all the cities where we operate.”

SmartCompany understands it is not unusual for class action lawsuits to be announced in the media and filed in the courts prior to being officially served to potential defendants.

Case to have broad ramifications

Speaking to SmartCompany, employment lawyer and adviser Peter Vitale says while the case is unlikely to have any immediate effect from an employment law perspective, the class action will “unquestionably” have higher-level ramifications.

“It may impact on whether or not Uber is directly liable for the actions of their drivers, but I suspect there are other courses of action which don’t really depend on if their drivers are employees or contractors,” he says.

“However, more broadly, it is a significant piece of legislation. It’s essentially asserting Uber came into the market as a bunch of outlaws prepared to do whatever it takes to disrupt the market.”

Despite not having any immediate impact on the ‘contractor or employee’ issue, Vitale says the scope of potential litigation and settlement for the case is “only limited by imagination”, theorising there could be resolution beyond just compensation for drivers.

“It’s a question of if this will be used as straight action for compensation or used to leverage how Uber operates their systems and how it engages with drivers. With litigation of this scale, nothing’s off the table,” he says.

“It unquestionably will have an impact, but historically we’ve seen that large-scale litigation doesn’t seem to deter Uber much.”

The lawsuit comes in the wake of Uber announcing it would be raising $10 billion in capital as part of an IPO this month, which values the company at more than $100 billion.

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