Uber agrees to US$28.5m settlement over safety claims

Uber lets customers use smartphone applications to summon and pay for rides provided by drivers using their own cars AFP/Geoffroy Van der Hasselt

SAN FRANCISCO: Uber said Thursday (Feb 12) it has agreed to pay US$28.5 million to settle a pair of lawsuits challenging its promises on driver safety checks.

The settlement submitted for approval in US District Court in Northern California called for the ride-share company to divvy up the cash between some 25 million customers and to "avoid using certain language in safety-related advertising as well as the term Safe Ride Fee."

"No means of transportation can ever be 100 per cent safe," Uber said in an online post.

"Accidents and incidents do happen. That's why it's important to ensure that the language we use to describe safety at Uber is clear and precise."

The civil litigation challenged Uber's claim that it used "industry leading practices" to check backgrounds of drivers. It also took issue with how it used money taken in by a "Safe Ride Fee" added on to trips.

Under terms of the proposed settlement, Uber will rename the charge a "Booking Fee" that it said will be used to cover safety and operational costs as needed.

"We are glad to put these cases behind us and we will continue to invest in new technology and great customer services so that we can help improve safety in the cities we serve," Uber said.

If approved, those represented in the class action suits will get a choice to have their shares of the settlement money paid to credit cards or Uber accounts.

They include people who took Uber rides in the United States between the start of 2013 to the last day of January this year, according to the San Francisco-based firm.

Uber lets customers use smartphone applications to summon and pay for rides provided by drivers using their own cars.

The company made its billionth trip last month in a milestone for the global ridesharing service.

Uber has expanded to hundreds of cities around the world, offering new options for both riders and drivers but also running into complaints from the taxi industry and regulators.

The company has reached a valuation of more than US$50 billion based on private investment disclosed to date.

Uber faces competition from US-based Lyft and other global startups.