U.S. ride-hailing company to appeal after Transport for London says it is not a ‘fit and proper’ operator
Uber has been stripped of its London licence in a surprise move that has triggered protests from drivers at the ride-hailing company and government ministers.
The firm’s application for a new licence in London was rejected on the basis that the company is not a “fit and proper” private car hire operator.
Uber’s cars will not disappear immediately as its current licence expires on 30 September and it plans to challenge the ruling by London’s transport authority in the courts immediately. The hailing app can continue to operate for its 3.5 million users in the capital until the firm has exhausted the appeals process. Uber has 21 days to launch an appeal but can continue to operate until the process expires – which could take months.
The decision by Transport for London was backed by London mayor Sadiq Khan, employment rights campaigners, and the trade body for the capital’s black-cab drivers, who have been staunch opponents of the US-based company.
However, it drew immediate criticism from Uber users, drivers and Greg Hands, the trade secretary. One of Uber’s 40,000 drivers in the capital, James Farrar, who has campaigned for better working conditions said TfL’s decision was a “devastating blow”.
TfL said that it had rejected the company’s application to renew its licence because “Uber’s approach and conduct demonstrate a lack of corporate responsibility” in relation to reporting serious criminal offences, obtaining medical certificates and driver background checks.
The licensing body also said it was concerned by Uber’s use of Greyball, software that can be used to block regulatory bodies from gaining full access to its app and undertaking regulatory or law enforcement duties.
Khan said he fully supported the decision to revoke Uber’s licence, saying all companies needed to “play by the rules”.
He said: “I want London to be at the forefront of innovation and new technology and to be a natural home for exciting new companies that help Londoners by providing a better and more affordable service.
“However, all companies in London must play by the rules and adhere to the high standards we expect –particularly when it comes to the safety of customers.”
But Hands, who is also minister for London, said: “At the flick of a pen Sadiq Khan is threatening to put 40,000 people out of work and leave 3.5 million users of Uber stranded.
“Uber must address safety concerns and it is important there is a level playing field across the private hire market.
“But a blanket ban will cause massive inconvenience to millions of Londoners, all while showing that the Mayor of London is closed to business and innovation.”
Sam Gyimah, a Conservative justice minister and MP for East Surrey, said it was “possible to have effective regulation of Uber without
penalising the consumers who benefit from more choice and lower
Steve McNamara, general secretary of the Licensed Taxi Drivers’ Association, which represents black-cab drivers, said the mayor had made the right decision.
“Since it first came on to our streets Uber has broken the law, exploited its drivers and refused to take responsibility for the safety of passengers. This immoral company has no place on London’s streets,” he said.
Uber said in a statement that the decision would “show the world that, far from being open, London is closed to innovative companies”.
“3.5 million Londoners who use our app, and more than 40,000 licensed drivers who rely on Uber to make a living, will be astounded by this decision,” the company added.
The company wrote to users on Friday asking them to “defend the livelihoods” of its drivers and sign a petition asking the mayor to reverse TfL’s decision.
Farrar, a co-claimant in a landmark employment tribunal decision against Uber and chair of the Independent Workers’ Union of Great Britain’s private hire drivers’ branch, said TfL should have stepped in earlier to protect drivers .
“To strip Uber of its licence after five years of laissez-faire regulation is a testament to a systemic failure at TfL,” he said.
The majority of Uber users responding to a Guardian request for comment opposed the decision to revoke the company’s licence.
Helen, from Walthamstow in east London, criticised the decision and said TfL should be working more closely with Uber. “With a lack of staff and police visible [on public transport], I often feel unsafe travelling alone and Uber has given me an affordable alternative to get home safely, ” she added.
Leo, a wheelchair user, said less than 30% of the tube network was accessible to him and buses were slow. “Uber has been a lifesaver for me. It has got me to visit family at short notice when the nearest accessible station was miles away and the bus took two hours,” he said.
Uber has prompted a change in behaviour that many Londoners will find tricky to kick, so if it fails to regain its licence rivals such as Kabbee, Hailo and Gett as well as traditional minicab firms and the likes of Addison Lee may benefit.
Conservative London Assembly member Andrew Boff said Khan was backing a “hugely damaging decision” that would put thousands of people out of work.
Tom Tugendhat, Tory MP for Tonbridge and South Malling, accused Khan of being a “luddite” who wants to “switch off the internet”. Chris Philp, Conservative MP for Croydon South, said: “The people who are going to be hit the worst are people on lower incomes who can afford Uber but can’t afford a black cab. It is anti-free market.”
In London, Uber has faced criticism from unions, lawmakers and traditional black-cab drivers over working conditions. Unions including the IWGB and GMB called on TfL to insist Uber guaranteed basic employment rights under the terms of its new five-year licence.
The GMB union said 72% of Londoners believed TfL should require Uber to safeguard minimum pay and holiday pay for its drivers.
Farrar will be in court next week when Uber is appealing against an employment tribunal ruling that would give its drivers access to the minimum wage, sick pay and paid holidays.
Employment rights campaigners said TfL’s decision was a warning shot to so-called gig economy companies, which include apps such as Deliveroo and delivery firms such as Hermes who argue their drivers and riders are self-employed.
Frank Field, the Labour MP who led a parliamentary inquiry which found that Uber drivers were treated as Victorian-style “sweated labour” said: “This is a gamechanger for the gig economy. Uber must now respond to TfL’s decision by totally resetting its business model.”
The blow to Uber in the UK comes after a tumultuous few months for the company, which has faced a string of scandals involving allegations of sexism and bullying. Investor pressure forced out former chief executive and co-founder Travis Kalanick this summer.
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Lead Image: TfL has told Uber it will lose its licence in London. Photograph: Blooberg/Bloomberg via Getty Images