I'm an app, duh... Uber, to the California government. Uber is now letting some CA drivers set their own fares as part of a test in response to CA's new gig-economy law (aka, AB5). The law forces companies like Uber, Lyft, or Postmates to treat workers as employees (give them sick days, benefits, etc). But Uber wants to prove its drivers are independent contractors. So it's made these changes:
It's a tech company, I swear... Uber's trying to prove it's just an app with independent drivers (nothing to see here), in an effort to dodge the 20%-30% cost increase that would come with turning their contractors into employees. The gig-law could also make rides pricier for riders, which could reduce demand for rides overall.
Uber's current pricing method is all about efficiency... 11PM Saturday rides are pricier than 10AM Sunday rides because surge pricing factors in demand. This new bidding-style pricing might mean higher fares for drivers, but could also mean lower fares if drivers compete for the cheapest price. This auction-like system is less efficient, but Uber is hoping it'll help prove that drivers have autonomy, and should therefore be treated not like employees.