Uber Eats Canada is accused of drip pricing practices for food deliveries in proposed class action suit
Uber Eats Canada is charging customers hidden fees with their orders, a proposed class action lawsuit is alleging.
The statement of claim filed against the food delivery platform with the Ontario Superior Court Justice last month alleges that Uber Eats has been hiding an additional service fee within its overall delivery costs.
Based on the filings, Uber describes this fee as something that fluctuates depending on the customer's order size, which is 'typically 10% of the basket, calculated on the total before any promotions or discounts are applied.'
The filings allege, however, that the service fee is fixed at a minimum of $2 for all food deliveries under $20 and a maximum of $4 for those above $40. The service fee is about 10 per cent of the items' order value for anything in between those price points.
This fee was allegedly tucked underneath the 'Taxes & Other Fees' line item and did not clearly state its existence at any point prior to purchase, like when a user reviews menu prices for example. The documents note this additional cost was only applied to deliveries, not pick-up orders.
Toronto-based law firm Koskie Minsky LLP—the class counsel—says doing this misrepresents the actual cost of app's delivery services, adding that by introducing and charging this fee by the transaction stage is a 'quintessential example of drip pricing practices.'
Here is everything you need to know about the proposed class action lawsuit:
What is drip pricing?
This type of practice is seen when a company adds mandatory fees after advertising low prices to lure in customers, so the advertised prices are not actually attainable, Competition Bureau Canada says. It does not include additional fixed charges like the harmonized sales tax, for example.
There are some telltale signs to look out for, Competition Burau Canada says, like if the price you see does not match up with what you pay or if you have to scroll down or read the fine print to find the actual cost of a product.
How does this impact Uber One users?
Uber One members pay just shy of $10 each month for a variety of perks, including five per cent off on orders and a free delivery fee over a minimum total of $15 from eligible restaurants.
The proposed suit alleges the plaintiff, a Toronto-area woman who was an Uber One member from October 2023 to December 2024, paid a total of $28.50 in service fees across eight delivery orders—despite paying the monthly membership fees.
The filings allege Uber Eats misrepresented the Uber One memberships and the benefits associated with it, saying that the service fee was charged to members every time a delivery order was placed—whether the $15 minimum spend was met or not.
What did Uber say in response to the class action lawsuit?
Uber Eats tells CTV News Toronto it could not comment on the proposed lawsuit, but said it is taking these 'allegations seriously.'
'We are committed to transparency and fairness in our pricing practices,' the statement reads. 'We are reviewing the claims thoroughly and will be defending the lawsuit.'
Am I eligible for the Uber Eats class action lawsuit?
Any Canadian who has placed an order for delivery on Uber Eats on or after May 16, 2023, may be eligible to participate in the lawsuit, as well as Uber One subscribers.
The Toronto-based law firm says people do not need to actively sign up to become involved with the class action—instead, if people qualify under the class action description, they automatically qualify unless they choose to back out from the proceedings.
There is a deadline to opt out of the class action if someone wants to pursue independent legal action, the firm adds.
Koskie Minsky says those who remain in the class action will be notified of their involvement after the statement of claim has been certified.
Do I have to pay legal fees for a class action?
Koskie Minsky says the costs are handled on a 'contingency fee basis'—meaning class counsel will only be paid of the suit is successful at trial or settled.
'In that case, class counsel fees may be paid by the defendants or out of the settlement or judgment proceeds as approved by the court,' the firm says online.
Class action members looking for some financial assistance may be able to look at the Class Proceedings Fund, which can provide support to approved plaintiffs for legal disbursements.
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