An Uber (NYSE:UBER) executive warned that the European Union's proposed rules for gig workers could force the company to raise prices by as much as 40% and even shut down in "hundreds" of cities, according to the Financial Times.
"If Brussels forces Uber (UBER) to reclassify drivers and couriers across the EU, we could expect to see a 50%-70% reduction in work opportunities," Anabel Díaz, regional general manager of Uber's (UBER) mobility business in Europe, told FT in an interview.
Díaz also warned that if gig drivers are given the same rights as full-time workers, Uber (UBER) will be forced to hike prices for customers. In addition, fewer drivers will lead to "significantly longer wait times."
"To manage costs of employment, Uber (UBER) would be forced to consolidate hours across fewer workers," she warned.
However, Díaz doesn't expect the rules to impact the ride-hailing company's profitability in Europe. "We have already proven our ability to grow in places like Germany and Spain using a third-party employment model."
Uber (UBER) contracts fleet management companies in Germany, because of which prices are higher and services are limited to major cities.
Díaz called on lawmakers to greenlight rules that preserve self-employed workers' desire for flexibility. EU lawmakers are currently negotiating the final text of the Platform Work Directive, aimed at improving working conditions for gig workers.
A majority of platform workers in the EU are categorized as self-employed, meaning they don't have access to labor rights and benefits.