Plan Insurance Blog

Cross-border Hiring: Uber Playing "Good Cop"?

Uber has announced to their drivers some drastic changes to the way they can operate.

In a nutshell, the controversial American giant states that drivers will only be able to operate in the area they have been licensed in, as opposed to the current situation, where a driver living in the Midlands could technically take jobs in London without being licensed by TfL.

What is changing?

From March 14th 2018, Uber drivers will still be able to head to destinations outside of their licensing area, however, they will only receive jobs in the region where they are licensed.

Uber has divided the country into 9 regions:

  • North East
    • Newcastle
    • Sunderland
    • Durham
  • North West
    • Merseyside
    • Greater Manchester
    • Chester
  • Yorkshire
    • Leeds
    • Bradford
    • Sheffield
  • Midlands
    • Birmingham
    • Wolverhampton
    • Leicester
    • Nottingham
    • Derby
    • Stoke
  • East of England
    • Cambridge
  • South East
    • Southampton
    • Brighton
    • Portsmouth
  • South West
    • Bristol
    • Bath
  • Greater London including surrounding areas
  • Wales
    • Cardiff
    • Newport


Why these changes?

Uber says the move is to help local licensing authorities that are struggling to prevent drivers not licensed by them from working in their district.


Our thoughts

With limited detail having been provided, it is difficult to see exactly how these measures will tackle the issue of cross-border hiring by Uber drivers. The “regions” defined are quite vague and fairly extensive. The phrasing of “Greater London including surrounding areas” is particularly non-specific. Will a driver licensed in Milton Keynes still be allowed to pick up jobs in London?

They also haven’t stated whether a passenger can be collected from outside of a driver’s licensing area and returned to a location within the licensing area. If this is prohibited, drivers will find the new mode of working much less profitable.

For example, if a driver takes a passenger from Sheffield to Manchester Airport, currently they would probably want to wait for a return fare. If they’re not permitted to do so, they will be empty on their return journey and those miles home will be much more costly than at present.

We all know that cross-border hiring has been a major issue for a number of years. We wrote early last year about the impact of cross-border hiring on taxi and private hire insurance costs. This move sounds like a clear attempt by Uber to foster better relations with licensing authorities across the country – having experienced several high profile issues in recent months, most notably with TfL, the overseer of their largest source of income.

However, we can’t help but wonder whether it is just a piece of clever PR? Will Uber actually implement the system in a fashion that has real-world results? If so, it will clearly be detrimental to them. They may lose out on a high number of fares and driver numbers are unlikely to fall as many will be resistant to changing licensing authority.

This measure sounds like a way to appease TfL – particularly following their new proposals to toughen their regulations by imposing a stricter assessment process, turning over trip data to the government and limiting drivers’ hours. But in reality, how is it going to be verified or enforced? Could it be a way to legitimise drivers licensed in the surrounding areas of London to operate within the Capital without the need for them to be licensed by TfL?


For more info on cross-border hiring, read our blog: does operating cross-border invalidate taxi and private hire insurance?