Nigerian drivers union cannot legally own an e-hailing app, AUATON factional secretary says

Ejike Kanife
While the law might prohibit AUATON from owning an e-hailing app, it does not prohibit drivers from doing so
Nigerian drivers union cannot legally own an e-hailing app, AUATON factional secretary says

The Nigerian e-hailing union cannot own e-hailing app companies under the law. This was disclosed by Comrade Ibrahim Ayoade, the factional general secretary of Nigeria’s e-hailing union, the Amalgamated Union of App-based Transporters of Nigeria (AUATON).

This is coming in the wake of demands by e-hailing drivers that they want to own their apps. Indeed, the Adedamola Adeniran-led leadership of the union had said that launching its app is a direction they could explore if app companies like Uber, Bolt and InDrive continue to come up with what they described as ‘unfriendly’ policies.

Aside from the law, Comrade Ayoade also pointed out that the union’s constitution also prohibits its leadership from owning app companies.

It is important to note that, constitutionally, unions cannot own app companies as we are designated as regulators under the law. Therefore, any claim that a union seeks to own app companies is misleading and not in line with our legal framework and responsibilities as regulators. Unions can’t own app companies, as we’re legally mandated to act as regulators, not industry players,” he said.

NLC Strike: e-hailing drivers to shutdown Uber and Bolt apps from August 2
Comrade Ibrahim Ayoade

In a recent chat with Technext, The National Ex-officio of the Adedamola-led faction of the union, Joseph Olawale said the cab-hailing companies designed the industry to their benefit and dictated the terms of the industry even when they did not own the cars or the financial muscle to provide the volume of vehicles required to power the industry.

This, he said, could force the union to level the playing field by launching an app of their own.

For AUATON, this might be an option soon if the ride-hailing app companies continue to operate unfriendly policies against our members. The app will be a tool for the union members and it’s in order if the union decide to have its app,” he said.

Read the story here: Nigerian drivers’ union may launch taxi-hailing app to rival Uber, Bolt and others

Can AUATON/drivers their e-hailing apps?

Olawale also referred to other countries where drivers developed their apps and competed with the big players: like Uber, Bold, Lyft and others.

In December 2020 for instance, a group of New York drivers launched the Drivers Cooperative, an e-hailing app company which aimed to give drivers a greater portion of their earnings, have profits redistributed back to them with an annual dividend, and assist them with auto loan refinancing.

Called the Co-Op Ride app, the e-hailing app attracted 40,000 downloads within a few months. Its drivers reportedly earn approximately 8 to 10 per cent more than those working for Uber or Lyft, and with 6,000 members it is the largest worker-owned cooperative in the US.

AUATON can NOT own an e-hailing app company under the law- factional secretary
The Co-Op e-hailing app is owned by drivers in the US

It is important to note that this group of drivers who created the Co-Op Ride app are not unionists. They were a group of drivers who formed a cooperative and developed an app that could give them more control over their earnings and other benefits.

But the group calling for creating an app in Nigeria is a union.

Indeed, Section 5, subsection C of the union (AUATON)’s constitution says that no elected or paid trade union official or employee or either a trade union shall own or have a substantial interest in any business enterprise with which his/her union bargains collectively or has interests and dealings with or in any other concern which is in competition with such enterprise or has any considerable dealings with.

While this effectively prohibits AUATON from owning an e-hailing app company, it, however, does not prohibit individual drivers from forming a cooperative or partnering with an existing business to launch an e-hailing app.

Going by the outcome of New York’s Drivers Co-Op app, Nigerian drivers might still get what they wanted: more control in deciding fares and reduced commissions.

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