In a letter to the SEC, Uber asks for a change of rules to allow it to compensate drivers with company stock
Uber on Thursday sent a letter to federal securities regulators, asking for rules changes that would let it provide company stock to its drivers, Axios has learned.
Context & Ripple Effects
Uber's letter lands mid-arc: since 2017 the company has been loosening who can hold its shares, letting long-tenured employees sell up to 10% of their holdings while still private. Drivers, classified as contractors rather than employees, sit outside every one of those programs — securities rules built around employer-employee relationships leave no lane for paying them in stock.
The ask is also a pre-IPO play with precedent nearby: by early 2019 both Uber and Lyft were reportedly planning [[a:939026|cash awards for their most active and longest-serving drivers with an option to put the money toward IPO stock]], a workaround that needed cash as the intermediary. The letter asks the SEC to remove that intermediary entirely.
First-order effects
- If the SEC accommodates even part of the request, Uber gains a compensation lever aimed directly at driver retention ahead of its listing — turning contractors into shareholders without reclassifying them as employees.
- The SEC now has to decide whether its accredited-investor and disclosure frameworks can stretch to millions of small-stake gig workers, a question its rulebook wasn't written to answer.
Second-order effects
- Lyft faces pressure to match any equity program, since both companies were already converging on the same driver-reward structure for their IPOs — differentiation here would show up in driver supply, not rider pricing.
- A green light gives every gig platform a way to buy loyalty with upside instead of wages or benefits, weakening the core argument that contractors deserve employee status because they share none of the company's success.
Third-order effects
- The pattern holds into policy: two years later the SEC formally proposed a [[a:960383|five-year pilot letting gig companies issue equity to workers capped at 15% of annual earnings]] — evidence the letter helped move contractor equity from company lobbying to regulator-sanctioned structure.
- Equity-for-contractors becomes a pillar of the broader 'third way' Uber has pushed in Washington, alongside its CEO's letter to Trump seeking updated labor laws between contractor and employee — ownership stakes substituting for classification reform.
The trend: Gig platforms are pursuing regulatory workarounds — direct SEC rule changes, IPO award structures, pilot programs — to give contractors ownership stakes as an alternative to reclassifying them as employees.