Airbnb: Unsafe Conditions Lead to Multiple Lawsuits and Settlements (2011-2021)
Case Controversy
Airbnb is a large and growing company that provides a platform for people to rent properties to guests. While for most users this is a safe platform, for others that has not necessarily been the case. Over the last 10 years there have been multiple reports about the safety of using the Airbnb platform. There have been cases where houses were trashed, and people were hurt by hosts and even strangers. Unfortunately, no significant steps have been taken by Airbnb to stop things like this from happening.
On August 2, 2011, a home rented using Airbnb was trashed and robbed. A host going by the name of EJ reported in blog post the following, “I returned home from an exhausting week of business travel to an apartment that I no longer recognized. To an apartment that had been ransacked…My home had been burglarized, vandalized and thoroughly trashed by a 'traveler' I connected with via the online rental agency, airbnb.com” (Little). After this, Airbnb announced that they would cover vandalism charges up to $50,000 for hosts with a safety tool they call Airbnb Guarantee. They also decided after the incident that they would create a trust and safety department. Airbnb ensured that trust and safety are their highest priorities in a statement to ABCNews. With that being said, they also claimed to be implementing immediate safety processes that would continue.
While Airbnb stated that they would implement more safety precautions, that did not stop tragedy from striking in 2015. At a New York City apartment, there were keys left at the counter for Airbnb renters to pick them up. There was no identification needed for the renters to pick up their sets of keys. On New Year’s Eve after ringing in the new year with friends, a woman left the bar she was in to return to the apartment they were renting using Airbnb. What the woman did not realize was that she was not alone once she arrived at the apartment. A man was there threatening her with a kitchen knife. An absolute stranger to this woman, he proceeded to shove her onto a bed and rape her (Carville).
The issue that presented itself in 2015 was that Airbnb did not have a policy for keys that were to be exchanged between hosts and the guests. After this crisis, Airbnb reportedly paid for the woman to stay in a hotel and for her mother to fly out from Australia. They also returned them home covering travel, health, and counselling costs. Two years after the incident, Airbnb worked out an agreement with the woman’s attorney after she sued the company implying that Airbnb would be held responsible or liable for the attack. It was reported that the woman received a secret settlement of $7 million. Company officials, according to Bloomberg, were afraid that negative publicity surrounding the alleged attacks would affect the success of Airbnb’s operations (Luscombe).
In a similar situation, a woman was allegedly sexually assaulted by an Airbnb “superhost.” What this means is that the host had many positive reviews and had guests frequently. The woman named Leslie Lapayowker was moving to Los Angeles and sought to stay at an Airbnb for a month while she was looking for permanent housing. The “superhost” in question was Carlos Del Olmo who was renting a studio attached to his house. Reported by The Guardian, “…according to the suit, Del Olmo immediately made her uncomfortable by making sexually suggestive comments, pounding on her windshield while she was in her car and screaming at his son loud enough so she could hear” (Levin). He allegedly went into the studio and locked the door behind him where he masturbated in front of her and shoved his tongue into her mouth demanding her to touch him without her consent. Once the incident was reported to police and to Airbnb, Del Olmo was banned from the site. An attorney also discovered that Delo Olmo had an arrest in Florida for a battery charge and domestic violence. Airbnb claims that they run background checks on all US hosts and guests, but it seems this was missed.
In 2019, there was a shooting that left five people dead at a Halloween party at a California Airbnb (Nathanson). The house was booked for one night, receiving numerous complaints to the police. “The guest, was reported to Airbnb for leaving a bullet at another listing just day before, triggering an internal safety warning, then advertised a ‘mansion party’ on social media” (Carville). After being criticized, Airbnb offered to pay for funerals and additionally later announced that there would be an additional $150 million spent on trust and safety.
It has been seen that over the last decade there have been numerous examples of devastating incidents occurring at Airbnb incidents. Airbnb continues to pay settlements worth millions every single year. Now in 2021, New York City published a data-sharing law that provides rather strict restrictions on short-term rentals. This was implemented in an attempt to halt illegal rentals (Fishman). The hope is that this will prevent dangerous incidents from occurring as well. Airbnb continues to claim to try and provide trust and safety to their guests.
Stakeholders
Individualism
Machan’s individualism is described as the only obligation of a business is to profit, therefore the businessperson must maximize their profit for the owner or stockholders within the law at the very height of it. The narrow interest of Airbnb in their customer’s and host’s struggles and pleas for a change from the company point towards their primary goal being profit. With multiple incidents varying from sexual assault, robberies, murders, and more with little to no change in the company, Airbnb places their profits first, but not directly. Their site states “Hosts offer one-of-a-kind stays and unique experiences that make it possible for guests to experience the world in a more authentic, connected way.” They market themselves as a company looking to provide meaningful, once-in-a-lifetime experiences to their customers, with protection for hosts as well as personalized support for guests. While the company seems ideal, their previous actions have revealed that they look to maximize their profit within the law as much as possible. Airbnb created a team specifically to address any illegal activities that occur at their hosts’ places, which “addressed everything from rapes at knifepoint, to Peeping Toms threatening revenge porn via hidden cameras, to carbon monoxide poisonings and deaths” (Andrew Paul, Input Magazine). Instead of creating a harsher set of rules and policies, as well as deeper background checks, they use hush-money payments from their ‘safety team’ to quiet down any hassle that comes from guests or hosts. Unfortunately for Airbnb, many reporters and data studies have revealed that the company has had hundreds of thousands of complaints over the past five years. This is linked with illegal activity, a report found “thousands of cases of account hacking with vacation dollars being stolen via fraudulent bookings,” “police interventions, bodily harm, threats, bug infestations, invasions of privacy via hidden cameras,” (Bloom, Forbes Magazine) and more. While the company is good at covering up any harm done to their guests or hosts, their complaints list continues to grow. Machan’s individualism theory states that the business may have other goals that will be prioritized over profit-maximizing, which is what’s been done in the case of the hundreds of nightmare stories at Airbnb’s. Over the course of the past ten years. Airbnb has made a name for themselves in the lodging industry, but their actions are causing many to question the safety of the company. The actions of Airbnb are technically ethically permissible due to the fact they try to sympathize with those who have been harmed under their wing, but their efforts are low. They remain neutral in their efforts to change and evolve as a company while making as little change as possible.
Utilitarianism
A utilitarian would not view Airbnb’s way of handling this situation as the most ethically beneficial. Utilitarianism values the happiness of all conscious beings and the absence of pain (Salazar 19). According to Salazar (17), “Business actions should aim to maximize the happiness in the long run for all conscious beings that are affected by the business action.” In this case, happiness was not reached for most of the stakeholders involved. The stakeholders are as follows:
Airbnb (as a company): Airbnb will be negatively impacted by this case because it seems as if they have been paying victims to keep them quiet. This was an avoidance of potentially facing a massive PR crisis. They could potentially lose guests because of their lack of safety measures taken. It is entirely possible that hosts could be lost for the same reason.
Airbnb Hosts: The hosts are negatively impacted because it is possible, they will be losing money due to fewer guests using the service because of safety concerns. Not only this but there is potential that a lack of safety protocols can result in guests that are dangerous themselves. This could lead to property damage and theft for the hosts.
Previous Airbnb Guests: The guests that have already been involved in this case have benefited in one way. That is that most of their individual cases have ended in settlements where the guest does get paid for any damage, whether it be physical or emotional. Presumably this has not been this case for all victims considering the likelihood that a case must be made with legal battles fought.
Future Shareholders: At this current moment, future shareholders are being negatively impacted by Airbnb’s actions. While there have been some actions that Airbnb has claimed to make, incidents keep occurring with millions in settlements being made every year. This will decrease the value of the stock in the future because fewer people could be using Airbnb potentially. The shareholders will lose less confidence in Airbnb if they continue to handle the situation they have been leading up to this point.
Future Airbnb Guests: Future Airbnb guests could potentially be both negatively and positively affected. They could be negatively impacted if Airbnb does find a way to implement more safety measures for all parties involved. Positively, with the traction of this case and the publicity it has received recently Airbnb could change their safety guidelines which would be good for future guests.
Kantianism
With a Kantian perspective while using the Categorical Imperative Formula of Humanity, the Airbnb company has failed. The company had a goal to keep the safety issues it was facing out of the public eye. However, even with the consent of their own rationality, they have been depriving everyone else of their own consent of rationality by keeping its current guests unaware of the harm that renting from hosts can cause. This can deprive those who face these crimes of their dignity and consent of rationality. This also sends a greenlight to those who want to commit crimes such as rape, because it shows that they will not be held accountable for their actions. Since the company has caused this deprivation, they can be seen as morally impermissible. When you are paying to keep these cases out of the limelight, you are hiding the dangers that can occur when renting off their site. The company has not been transparent about the issues with their shareholders or guests, in fear of backlash. It has even come to a point where they have a task force called Sonderkommando , that even has political crisis experts on its team, that has no budget when paying off victims of crimes that had resulted because of the company’s negligence to avoid legal and social responsibility. When a company is purposefully taking every effort and measure to ensure that they cannot be held accountable for such crimes, they violate every ethical standpoint of Kantianism. They are not trying to fix the issue, only trying to cover their tracks.
With Kantianism there is an ethical question of, should Airbnb be making their customers aware of these dangers? If they are hiding these dangers people cannot make the rational decision of not using their services. Being able to allow people to make these decisions freely while still educating them about these extenuating circumstances allows you to respect the fact that people have free will while still educating them about the dangers. They can make the information available while still providing services to help in the case that an assault may happen again. Airbnb has a duty to protect their guests, however the guests do not have the right to the money of the company in the case that something may happen.
Virtue Theory
The Airbnb company has not in any way followed the Virtue Theory method. According to Aristotle, “people will likely make the right choice when faced with ethical challenges.” Virtue ethics helps us understand what it means to be a “good” human being and acts as a guide for living life without giving us specific rules for resolving ethical dilemmas. (Ethics Unwrapped. (2021, January 25).) I believe they tried to be “good” people, but it never worked out the way they were hoping it would. Problems kept coming and they were never effectively solved.
They tried to look good for the media, but people never knew what went on behind the scenes. The “virtues” of a business or a character in business is courage, honesty, and justice. (Salazar, 7) Without these virtues how can anybody trust what you say or believe they are in good hands? “The purpose of the Virtue theory is to deal with the rightness or wrongness of individual actions, it provides guidance as to the sort of characteristics and behaviors a good person will seek to achieve.” (BBC. (n.d.).) It provides guidance to people on how to run a business the best and honest way. If the Airbnb companies executed these skills, they wouldn’t have encountered any of the problems they have today.
There are four easy steps to learn how to be “virtuous”. Learning to be Virtuous includes: 1. Model yourself after a virtuous person. 2. It will be hard at first! (Weakness of the Will) 3. Do it anyway, and it will become a habit (disposition). 4. Habit = Character Trait = Virtue (if it is a good habit) (Salazar, 8) It’s never easy to be a “good” person, but it’s the right way. Guests and hosts might forgive but never forget their experiences. “Virtue ethics teaches: An action is only right if it is an action that a virtuous person would carry out in the same circumstances, A virtuous person is a person who acts virtuously, A person acts virtuously if they "possess and live the virtues", A virtue is a moral characteristic that a person needs to live well.” (BBC. (n.d.).)
Action Plan
The current issue with Airbnb is that they are acting unethical in a few diverse ways. They show a lack of empathy towards the multiple incidents that their hosts and guests have gone through over the course of 10+ years. To start resolving this problem, Airbnb will first have to acknowledge and take accountability for their lack of action. Being able to take accountability will make the company look more reputable and show that they have social responsibility towards their community. Producing preventative measures to help avoid these kinds of issues will allow the company to get one step ahead of the issue. You will not have to fix something that never happened in the first place. In the case that something happens, guests should be able to report these issues without the fear of retaliation or being silenced. Allowing guests to have their feelings heard and valued by the company will keep customers coming back. Compensating guests who have experienced traumatic events like this should always be put into the company's budget. This is for things like mental health assistance, damage to property, and lost wages. Lastly, companies should speak upon these issues before the media gets to them to avoid the look that they are hiding and sweeping these things under the rug.
To have a successful future, Airbnb must rebrand themselves. Airbnb’s current mission statement is “...to create a world where anyone can belong anywhere, and we are focused on creating an end-to-end travel platform that will handle every part of your trip” (Airbnb). There are certainly ways that this mission statement could be improved to help Airbnb become a better company. The following should be their new mission statement: “Our mission is to create a safe and protective atmosphere for all guests. We are focused on maintaining this atmosphere on our platform that promises to handle every part of your trip.” This new mission statement is an improvement because it keeps some of the core elements of their original, but also acknowledges the issues that they have been facing over the last decade.
Their new core values to follow are customer safety, commitment, honesty, accountability, and respect. To prevent the issues occurring at hand, Airbnb will have to hold themselves to a higher standard of accountability than they did previously. They will have to train their safety teams to work with hosts and guests rather than against them to improve the way Airbnb conducts themselves. This will include training their employees to react in a timelier manner to any situations that are reported to customer service. One of the issues that occurred with Airbnb customer service was that they displayed a lack of care for the incidents reported, which is why customer service employees must be required to build relationships with those who use and work under Airbnb. Employees that do not align with these core values will be given warnings and if their behavior is repeated, they will be let go. If they go beyond improving the company and building better relationships with customers as well as keeping them satisfied, they will be given promotions and other reinforcements for their demanding work.
Airbnb, primarily, needs to acknowledge what has happened and take accountability for their actions or lack thereof. They need to address the public and especially their consumers to explain why they did what they did. Creating new policies is necessary to keep their consumers coming back and will also relieve some of the stakeholders who have been affected by this controversy. Once they acknowledge this and ensure that they are going to make a change, then they can make progress as a company. Not only this, but they must keep the promises they make with their new policies making sure they provide a safe environment for their users.
While Airbnb has appeared to try and fix the issues surrounding safety for guests and hosts, it does not seem that they have been remarkably successful. It also appears as if they are trying to avoid negative press when they pay previous victims in settlements which included agreements to not discuss the details of said settlement. Overall, they did not act ethically to resolve the current issue or take into consideration the long-term effects. Using this new plan, they can avoid the negative press and continue to make a profit. Not only this, but they will also be acting ethically ensuring the safety of their guests and hosts alike.
Authors: Garrett Barnachez, Emily Catanzaro, Jacqueline Garvin, Chandler Davis
Page Break
References
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