Dynamic Pay on Gig Platforms Should Be Banned, TUC Urges
The use of “dynamic pricing” to determine pay on gig economy platforms such as Uber should be prohibited, according to trade union leaders. They argue this practice leaves workers vulnerable to opaque algorithms that create uncertainty around their earnings.
A report by the Trades Union Congress (TUC) highlights the human impact of dynamic pay, revealing that wages are increasingly disconnected from time, skill, or effort. Instead, workers face a speculative system where compensation is decided by algorithmic processes with minimal transparency.
Dynamic pricing involves algorithms adjusting prices for customers and commissions for workers in real time based on supply and demand. However, union representatives contend this replaces fixed or transparent rates with constantly changing pricing mechanisms, obscuring the data and decision-making behind pay.
Uber initially charged a fixed 20% commission on UK fares, which later increased to 25%. In 2023, the company introduced dynamic pricing, an algorithm that variably sets driver pay and passenger fares.
The TUC report, compiled with the non-profit Worker Info Exchange (WIE) and academics from Nottingham Trent’s Work Futures Observatory, includes testimonies from nearly a dozen workers. Many described their pay as akin to “gambling,” “leaving it to fate,” or “waiting for the jackpot,” reflecting a sense that earnings are determined by chance rather than labor.
The report calls on the UK government to act to end dynamic pay and to advance reforms strengthening employment rights. It also urges granting workers and unions access to employer-collected data used in artificial intelligence decision-making.
Worker Experiences and Concerns
Several Uber drivers featured in the report said dynamic pricing has harmed their income, family life, and health. They also expressed concerns that passenger safety might be compromised, as intense competition pressures them to drive while fatigued.
Some drivers reported earnings below the minimum wage.
“It’s too unfair. I want to smash my screen. It feels miserable.”
These words were shared by Vladimir, a London-based Uber driver since 2016, who believes his income has declined due to dynamic pricing.
“Uber went from 100% transparency … to 0% transparency. Everything is ‘flexible’. The fare is flexible. The commission is flexible. What the driver gets is flexible. No one knows.”
Research published in partnership with WIE by Oxford academics found many Uber drivers earn substantially less per hour since dynamic pricing was introduced in 2023. The study also noted that the company’s share of fares increased alongside the algorithmic fee adjustments.
TUC Demands Urgent Action
Paul Nowak, TUC general secretary, called for an urgent crackdown on dynamic pricing.
“Two drivers doing practically the same job at the same time could be paid wildly different sums determined by an algorithm. And when taking a job, they have seconds to decide whether it will be worth their time with patchy information.”
“That’s plainly unfair. This is a rigged system which overwhelmingly tilts the balance of power to platform company bosses over workers.”
“Let’s call this out for what it is: exploitation by the algorithm.”
Uber is currently facing legal challenges coordinated by WIE over its use of dynamic pay in the UK, the Netherlands, and other European countries.
Cansu Safak, research lead at WIE, stated:
“The absence of basic worker rights has allowed dynamic pay to thrive. With no transparency over the conditions they work under, drivers have been forced to turn to data protection law as the only remaining route to assert their rights.
And in the absence of meaningful regulatory response, they are once again turning to the courts to seek justice through the collective legal action we have launched.”
Uber’s Response
An Uber spokesperson said drivers choose the platform for its flexibility, earnings potential, and benefits.
“Uber has always priced trips based on a range of factors, including time, distance and demand, and drivers always see the destination, and how much they will earn from the trip, before they decide whether to accept.
All drivers receive a weekly summary of their earnings, showing how much passengers paid and exactly what Uber and the driver received. The vast majority of total fares continue to go where they belong: into drivers’ pockets, and the amount Uber keeps from fares has remained relatively flat.”
The UK government has been contacted for comment.
