Uber deceived drivers on pay, FTC says

Uber has agreed to pay $ 20 million for exaggerating how much its drivers could earn and encouraging them to lease cars through a “low- cost” program the government says was anything but.

The deal was made public in documents filed by the Federal Trade Commission in San Francisco. It alleges Uber had engaged in unfair or deceptive practices.

Uber didn’t admit to wrongdoing but did agree to settle with the FTC. Affected drivers will be issued refunds, though the agency has not determined exactly how that will be accomplished. The complaint, filed in U. S. District Court in San Francisco, said Uber claimed drivers could “earn specific high hourly and yearly earnings,” but in many instances they did not.

In one post on its website, Uber said the median income of uberX Drivers was “more than $ 90,000/ year/ driver in New York and more than $ 74,000/ year/ driver in San Francisco.” According to the FTC, the median income of an uberX driver in New York City was $ 61,000 and in San Francisco, $ 53,000. The company also overstated the hourly earnings of its drivers in job listings, the FTC alleged, claiming drivers in Boston could earn $ 25 per hour, in Minneapolis $ 18, and in Philadelphia $ 25. The FTC said Uber’s own data on hourly earnings showed that in Boston, Minneapolis and Philadelphia in December 2014, fewer than 10% of drivers averaged the promised hourly rate.

In a statement, the company said it was pleased to have reached an agreement with the FTC and that it had made many improvements to the driver experience.