Forget Lawsuits, Uber Drivers' Days Are Numbered

Ride-sharing giant Uber Technologies Inc. recently settled a class-action lawsuit by Uber drivers for $100 million. The suit was focused on whether or not to classify Uber drivers as full-time workers (where they would be entitled to benefits) or freelancers. In addition to the monetary cost, it was decided that Uber drivers will not be classified as employees of Uber, nor would they be allowed to unionize.

Despite the significant amount of money settled upon, Douglas O’Connor, the driver originally named in the lawsuit, believes the agreement is not in his interest or that of other drivers, and that he felt “utterly betrayed and sold-out by an unjust settlement result that only benefits Uber.”

O’Connor’s protest follows those from other drivers who also believe the settlement does not provide enough monetary compensation for mileage and other expenses. And they have a point. The $100 million is actually an initial payment of $84 million across 385,000 drivers, in addition to the likely cut the attorneys will take; the other $16 million will be paid in the event Uber goes public or is acquired at a price 1.5 times higher than its most recent valuation. With these numbers, the settlement equals about $218 per driver (insert grimace emoji here).

No More Drivers

This is not the first lawsuit filed against Uber, nor is it likely to be the last. But the ride-hailing company may have found the perfect way to combat any future lawsuits: just make its drivers disappear.

In Pittsburgh, Uber is testing a specially designed Ford (NYSE:F) Fusion that will be on the streets collecting mapping data, and most importantly, practicing its self-driving capabilities. The company said there will be a trained driver in the driver’s seat keeping an eye on operations while the car is in self-driving mode.

Uber partnered with Carnegie Mellon University to further develop its driverless car dreams; the two entities opened the Uber Advanced Technologies Center in Pittsburgh, and are preparing to launch autonomous vehicles in to its fleet by 2020.

"While Uber is still in the early days of our self-driving efforts, every day of testing leads to improvements," the company said in a blog post. "Right now we’re focused on getting the technology right and ensuring it’s safe for everyone on the road — pedestrians, cyclists and other drivers."

Self-driving and autonomous vehicles are not new concepts. Alphabet’s (NASDAQ:GOOGL) Google division has been designing and testing driverless cars for a while now, and one of Uber’s biggest competitors, Lyft, has recently partnered with General Motors Co. (NYSE:GM) in order to test a fleet of self-driving electric taxis on public roads.

Uber Still Rules

A $100 million settlement is nothing to a company who is worth over $50 billion. It’s an annoyance, really, a small hurdle to overcome. And the settlement, in a way, validates Uber’s business model, a model in which it broke new ground in terms of both tech innovation and regulation.

If, and it’s looking like when, Uber’s self-driving car ventures become a success, there will be no need for drivers at all. Just imagine: you open the Uber app, request a car, and minutes later, a fully autonomous vehicle arrives at your location, ready to take you anywhere. No drivers could significantly reduce the number of lawsuits filed against Uber, and greatly cut down on both costs and headaches for the company.

Had the lawsuit not worked out in their favor, the implications of the settlement would have reached far beyond Uber, but to the entire on-demand, we-commerce culture. The companies that operate in this space—think TaskRabbit—would undoubtedly have been hit hard, more so than they already are.

But thankfully for Uber, and all of its users and investors, it did. Now we can focus on imagining just what these driverless car rides will be like. Will they feel normal? Will there be music or awkward silence? Will Uber employ an Amazon (NASDAQ:AMZN) Echo-like tool to help personalize rides? Only time will tell, but for now, let’s take comfort in the fact that the Uber as we know it is still here, and still getting us to where we need to be.