Ride-share company Uber has agreed to pay $271.8 million to compensate rival taxi and hire car drivers, according to lawyers for 8000 drivers from the rival taxi companies.
In 2022, the company admitted that it had breached Australian Consumer Law after falsely telling customers they could be charged for cancelling trips. It also misrepresented prices being charged by rival taxi companies.
The Australian Competition and Consumer Commission fined it $21 million for the breach.
But the legal firm of Maurice Blackburn also took on Uber on behalf of the taxi drivers and hire-car owners who said their businesses had been damaged by Uber's misleading claims.
A company statement said this morning: "Uber has agreed to a $271.8 million settlement to compensate taxi and hire car drivers, operators and licence holders, one of the most successful class actions against the ride-share giant in the world and the fifth largest class action settlement in Australian legal history."
The ACCC said when it found against Uber: "Uber admitted it breached the Australian Consumer Law by engaging in misleading conduct and making false or misleading representations in relation to cancellation messages and the price of Uber Taxi rides."
In some areas, Uber had said on its app that cancelling a ride might mean a cancellation fee "even if those users were seeking to cancel during Uber's 'free cancellation period'," the ACCC said.
In response, Uber changed the message. The ACCC said that "more than two million consumers saw the misleading cancellation message".
In Sydney, Uber had quoted what a ride would cost if the potential customer took a taxi instead. This information, according to the ACCC, was misleading.
The class action on behalf of taxi drivers was initially brought by Melbourne driver Nick Andrianakis, but it then snow-balled to involve the 8000 drivers.
Maurice Blackburn Lawyers principal Michael Donelly said the settlement followed a gruelling five-year legal battle.
"Uber fought tooth and nail at every point along the way, every day, for the five years this has been on foot, trying at every turn to deny our group members any form of remedy or compensation for their losses," he said.
"On the courtroom steps and after years of refusing to do the right thing by those we say they harmed, Uber has blinked, and thousands of everyday Australians joined together to stare down a global giant."
"We are extremely proud that thousands of people put their faith in us and Nick Andrianakis and allowed us to do what we do best - holding to account major organisations that we say inflicted mass wrongs on people."
Uber said that it that the settlement put "legacy issues firmly in our past".
"When Uber started more than a decade ago, ridesharing regulations did not exist anywhere in the world, let alone Australia. Today is different, and Uber is now regulated in every state and territory across Australia, and governments recognise us as an important part of the nation's transport mix," its statement said.
Steve Evans
Steve Evans is a reporter on The Canberra Times. He's been a BBC correspondent in New York, London, Berlin and Seoul and the sole reporter/photographer/paper deliverer on The Glen Innes Examiner in country New South Wales. "All the jobs have been fascinating - and so it continues."
Steve Evans is a reporter on The Canberra Times. He's been a BBC correspondent in New York, London, Berlin and Seoul and the sole reporter/photographer/paper deliverer on The Glen Innes Examiner in country New South Wales. "All the jobs have been fascinating - and so it continues."
