Disrupted Disruption – Luddites and the Law

How a combination of Luddite thinking and legacy legislation are trying to stop the tide of disruption – and won’t

iDisrupted Commentary

We comment on a regular basis about legislation being a barrier to change – especially in pharma and health – for example our recent article on Disrupted Health – robot pills being delivered by sugar needles illustrates the amazing speed of tech driven health breakthroughs.

Now we’re starting to see the rise of the Luddite revolution – the reactions of workers whose jobs are being moved on by technology. The French taxi drivers took to burning Uber cars recently (in this case backed up by the French president).

So poor Uber is up against it again – this time the UK union, GMB, is taking (what might be considered to be) a Luddite stance against Uber. Whether their stance has legs is challenged by. . . later in this article.

The point though is this. . . in a free market economy disruption cannot be stopped – it can be slowed – but not stopped – the best thing to do is work with it rather than rile the beast and work against it. However, and it’s a big however, if you’re a disrupter entering a market it might be worth think about paying taxes where you make them.

Here’s a recent blog post from the founder of a fintech startup in the USA who talks about how legacy legislation in the US and Europe is crippling Finch startups – and the real people it’s going to hurt – consumers.

Oh, and here’s a recent video of protestors destroying an Uber car in Mexico:

For a sense of perspective on the law and Uber (at least in the UK), I asked senior employment lawyer, Gareth Brahams at Brahams Dutt  at for his take, “The legal question is are Uber drivers really business partners, or are they workers or employees?  It is important because the law confers lots of rights on employees (e.g. unfair dismissal and the right to redundancy payments); some on workers which employees also get (like minimum wage, paid holiday etc.) but almost none on arms length business partners. In many cases we instinctively know what someone is, but when pushed it is hard to pin down exactly why. Even the judges have resorted to saying that an employee is like an elephant – you know one when you see one. But when the disruptive power of technology changes the landscape and makes it all grey – can you still see the elephant?

It is easy to see how technology could be used to create some pretty asymmetrical “business partnerships” so maybe the legal Luddites have a point.  The drivers on the ground aren’t really running their own businesses, they are working for Uber on a commission basis.  Just like in the days of the mill and the factory, they are beholden to their bosses. Technology disrupts the form not the substance.  Employment law is there to redress the balance of power between the over-mighty master and the too easily exploited servant; technology might alter the way the imbalance of bargaining power manifests itself but not the fact of it. It reminds me of when e-signatures first came out and people asked how would the law deal with the departure from marking your agreement to something by the centuries old use of pen and ink. The answer was “very easily”.  The law adapts to disruption so fast and effectively because despite what non-lawyers assume, the judges are always so much more interested in substance than form.”