Independent Drivers Guild Warns City Proposals To Limit For-Hire Vehicles Could Devastate Thousands of Families

23 Jul 2019

Independent Drivers Guild Warns City Proposals To Limit For-Hire Vehicles Could Devastate Thousands of Families

Proposed Rules Are Already Harming Thousands of Low Income Drivers And Could Devastate Thousands More Families if Passed

Prepared Testimony: IDG Testimony

New York, NY — The Independent Drivers Guild today warned New York City officials that unintended consequences of proposed rules are already harming thousands of low income families and could devastate many more if passed without significant changes. New York City’s Taxi and Limousine Commission held a hearing Tuesday on two proposals to regulate the city’s for hire vehicles. The IDG urged the commission to hold off on a vote on these proposals.

Instead, the Guild is urging the city to limit new TLC drivers licenses, a policy that reduces congestion without devastating the more than 70,000 low income New York City families who rely on the income of app-based for-hire vehicle drivers.

“Unintended consequences of these proposed rules are already harming thousands of low income families across our city and could devastate thousands more if passed. We urge the Commission to hold off on voting on these proposals,” said IDG Executive Director Brendan Sexton.

“A permanent vehicle cap incentivizes a return to yellow taxi-like twelve hours shifts, which would be a huge step backward in working conditions for thousands of the city’s professional drivers. And Lyft’s response to the cruising cap proposal is already harming thousands of drivers ability to make a living. It would be irresponsible for this commission to add yet another rule regarding for-hire vehicle utilization before we have even seen the impact of the utilization rules passed in December which go into effect in February,” added Sexton.

The Independent Drivers Guild campaigned for more than two years to win the protection of a minimum wage in New York City and drivers are concerned that the city’s new proposed rules could wipe away those gains for thousands of drivers.

NYC Proposal 1: Extend the “Vehicle Cap” Indefinitely- In June, city officials announced their intent to make the cap on TLC for-hire vehicle licenses permanent. The city council passed a one year moratorium on for-hire vehicle licenses in August 2018. This proposal would extend the vehicle cap indefinitely. The city anticipates this proposal would have a very limited effect on congestion but would cause decreased service and increased wait times in Manhattan. With the lack of affordable options, the TLC also assumes the number of app-based drivers sharing vehicles will triple, which would be a huge step backward in working conditions for the city’s professional drivers.

IDG’s Take From Executive Director Brendan Sexton: “The vehicle cap is a flawed policy. Since the vehicle cap went into effect, the TLC has licensed more than 12,000 new FHV drivers, essentially authorizing as much as 50 million more FHV hours on our streets. The unlimited growth in drivers makes it harder for all for-hire vehicle drivers to make a living. The vehicle cap didn’t stop that growth. What the vehicle cap does is empower predatory leasing and app companies at the expense of low income drivers. Because of the vehicle cap, thousands of existing drivers and all new TLC drivers are stuck renting vehicles instead of licensing their own vehicle. These drivers pay thousands more to rent than it would cost to own — and have no vehicle at the end to show for it. While we could stomach a one year cap, an extended cap is a bad long term policy that empowers predatory leasing companies and app companies at the expense of thousands of New York’s low income drivers.”

IDG’s Take From Member & App-based Driver Tina Raveneau: “The city’s so-called vehicle cap is making drivers like me slaves to the leasing and app companies. It has cost me thousands of dollars already and must not be extended. I am paying thousands of dollars more per year to rent my TLC vehicle than it would cost me to finance my own vehicle. I am a single mom, struggling to get by. Because of this rule, I am stuck throwing my money at these big leasing companies, when I could be building equity in a vehicle I could actually keep – and I am not alone.” [Raveneau is an IDG member who lives in Brooklyn and has been an app-based driver for two and a half years, driving primarily for Lyft but occasionally for Uber.]

NYC Proposal 2: New Cruising Cap To Limit FHVs in Manhattan – The city is proposing to cap the percentage of time Uber, Lyft, Juno and Via drivers can drive in Manhattan’s “core”. The city anticipates this will reduce service and increase wait times in Manhattan.

IDG’s Take From Executive Director Brendan Sexton: “First of all, the city already passed a rule like this in December with company specific utilization rates which haven’t even gone into effect yet – they go into effect in February. To add yet another rule regarding for-hire vehicle utilization before we have even seen the impact of the first rules makes no sense at all.

Second of all, we have already gotten a preview of how the app companies will react to this rule and it is bad news for drivers. Without a cap on drivers, the apps are empowered to manipulate driver access to their apps for the companies’ gains. The city assumed that the app companies first response would be to cut their own profits to a minimum before they start restricting driver access. But it comes as little surprise that the apps are protecting profits at the expense of drivers. App companies have already begun blocking access to the apps for certain drivers, leaving thousands of drivers desperate, behind on bills, and not knowing when they will be able to work next. Lyft, for example, has launched this policy but exempted those drivers who rent or lease vehicles through Lyft’s own leasing program, incentivizing drivers to pay Lyft upwards of $400 per week and further enriching the company.

The city should hit a hard pause on this proposal … at least until we see how the utilization rate policy which starts in February shakes out.”

IDG’s Take From App-based Driver Tina Raveneau: “We already got a preview of how the apps are going to respond to this policy and it’s no surprise to us that drivers are the ones to pay the price. Lyft already reacted to these proposed rules with a policy of logging off drivers who do not rent their cars directly from Lyft. I have relied on my income as a full time Lyft driver for two and a half years and these policies are already hurting my earnings. I end up spending more time on the road driving around waiting for Lyft to let me log on than I ever did before. Without being able to work the hours I used to, I have no choice but to work even longer hours or come up short on my bills. I am scared that this cruising cap idea will make it ten times worse for drivers like me.”

IDG Policy Solution:
The IDG has long called for limiting TLC drivers licenses instead of TLC vehicle licenses. Limiting new TLC drivers would be a much more effective way of limiting for-hire vehicle hours on the street AND it would empower workers instead of harming them.

TLC Drivers are already limited to 12 hour days, so a limit on drivers is a direct way to limit for-hire vehicle hours on our streets. Vehicles, however, can be shared and, in fact, the TLC assumes that the number of shared vehicles in use by drivers for apps like Uber and Lyft will triple in the first year if the vehicle cap is extended. This makes a vehicle cap a worse policy for addressing congestion and a worse policy for workers as sharing vehicles in shift work would be a huge step backward in working conditions for app-based drivers.

“For-hire vehicle drivers have long been exploited and treated as expendable. Limiting new TLC driver licenses is a simple way to flip this dynamic and empower workers instead of empowering app companies, fleet owners, and predatory leasing companies. Limiting the labor pool will require all companies to compete to keep drivers working for them, meaning the competition shifts away from the expendable driver mentality, a race to the bottom on driver pay — and shifts to providing better working conditions, pay and benefits.” said Sexton.

The IDG is a Machinists Union affiliate which represents and advocates for more than 70,000 app-based drivers in NYC. We are Uber, Lyft, Juno and Via Drivers United for a more fair industry. Follow us on twitter at @drivingguild