Uber and Lyft Drivers Petition NYC for a Ride-Hail Minimum Wage
Formal Rulemaking Petition Requires City To Decide in Sixty Days
More than 15,000 Drivers Sign Petition Calling for City to Close the Minimum Wage Loophole, Raise Pay and End Price Gouging
New York, NY — Today, the Independent Drivers Guild (IDG) is formally petitioning New York City to enact a livable minimum wage for app-based for-hire vehicle drivers, which would increase pay rates by 37 percent, and to prohibit price gouging in the industry, by capping rider app fees at 20 percent. The IDG, a Machinists Union affiliate which represents and advocates for more than 60,000 of these drivers, submitted the proposed rule today to the city’s Taxi and Limousine Commission (TLC), the agency responsible for licensing and regulating New York City’s taxis and for-hire vehicles. The IDG’s petition advocating for the proposal has garnered support from more than 15,000 signers. The IDG will continue its campaign for these pay protections by launching calls and emails to city officials as well as promoting the cause with flyers and ads.
Recently, MIT researchers found that a significant portion of Uber and Lyft Drivers make less than minimum wage after expenses. Even in New York City, where nine in ten Drivers drive as their household’s main source of income, IDG survey data shows that many Drivers make less than minimum wage after expenses.
“After years of pay cuts and exploitation, New York City’s ride-hail drivers can’t make ends meet and many are making less than minimum wage after expenses. New York has a long history of standing up for working families and must not allow these apps to violate our values. We are calling on the city to close this minimum wage loophole and enact a livable minimum pay rate for app-based drivers. We cannot allow multi-billion dollar corporations to profit off the labor of New York workers without paying them a fair rate,” said IDG founder Jim Conigliaro, Jr.
“We are making much less than we were just a few years ago — and companies like Uber and Lyft are pocketing more. To try to make up the difference, drivers are forced to work longer and longer hours, but we are still unable to make ends meet,” said app-based driver and IDG member Aziz Bah. “I am an immigrant from Senegal supporting my family, including two children. I came to this country to work hard and make a better life for my family, but now it seems like the promise and protections America is known for simply don’t apply to us.”
The city is required to respond to rule petitions within sixty days, either agreeing to grant the petition and initiate rulemaking by a specific date or denying the request. While the TLC enforces certain protections for driver pay and to prevent consumer price gouging in the taxi industry, there have been no such protections in the app-based for hire vehicle industry.
Last year, IDG members petitioned for and won a New York City law and a TLC rule which forced Uber and Via to add a tipping option to their apps. In that petition, the IDG noted that further protections were needed to ensure drivers could maintain a dignified living. The Commission responded in agreement, stating “we agree with your position that rules governing tipping are not a substitute for a regulatory scheme that ensures that Drivers earn a livable wage.” Guild members and the TLC have had ongoing discussions on the need for pay protection rules since shortly after the IDG’s launch in 2016 and continuing with the issuance of the IDG’s detailed proposal in November 2017.
A 2017 Independent Drivers Guild (IDG) survey of New York City Drivers found that:
73% of workers who had been in the industry for at least a year reported their financial well being was worse now than had been previously.
73% of Drivers worked more than 10 hours on their most recent shift, with Drivers reporting a median shift of 11 hours and a mean shift of 11.5 hours.
85% of Drivers work at least 30 hours per week and nearly two thirds drive at least 45 hours per week.
56% reported being paid less than $150 before business expenses on their most recent shift.
Workers who lease or rent their vehicle report mean annual expenses of $35,464, and a median of $31,200.
Workers who own their vehicle or have a loan had a mean annual cost of $30,056, and a median of $21,424.
89% reported that being a For-Hire Vehicle (FHV) worker was their main source of income.
57% identified their household income as less than $50,000/year. 22% of respondents reported household earnings of less than $30,000 per year.
56% indicated they care for a dependent under the age of 18.
The IDG proposed rule includes:
1) A minimum pay rate that would raise wages by 37 percent for New York City app based drivers. This rate would apply across all platforms including Uber, Lyft, Juno, and Via.
According to a 2017 survey, the average work day for drivers is more than 11 hours, which is 37 percent above 8 hours: the basic right of a maximum work day. The Guild proposed a minimum pay scale based on a 37 percent increase over 2017 rates to promote safe driving and return driver compensation to be nearer the rates offered in the past. The Guild proposal also includes a premium pay rate for drivers of Wheelchair Accessible Vehicles to incentivize the transition to such vehicles and to offset the increased costs.
Here is a side by side comparison of a sample five mile, thirty minute ride in New York City in 2013, today and under the IDG’s proposal:
*Includes taxes and company fees
**Passenger fare is no longer bound to actual mileage or minutes traveled.
2) Prohibit price gouging. Currently, apps can charge passengers more than double what a worker is paid, and the IDG’s report has examples of just that. The IDG’s proposed rule would prohibit Uber, Lyft and other companies from charging passengers more than 20 percent over what the worker is paid. This would prevent price gouging and return commissions to the rates riders and drivers agreed to previously.
3) Return trip to New York City pay (known in the industry as “deadhead pay”)—drivers must be paid for the trip back to New York City while no passenger is in the car. Failure to pay drivers for return trips is unfair and costly to workers and puts workers’ compensation insurance and other insurance coverage in jeopardy.
The IDG’s rule petition comes as New York lawmakers are considering numerous proposals to increase taxes and fees on the ride-hail industry in attempt to fund public transit, reduce congestion and update regulations. The IDG rule would prevent apps from passing those taxes and fees on to already struggling drivers, incentivize workers to operate wheelchair accessible vehicles, and reduce driver’s time on the road which would reduce congestion.
The IDG is also calling on New York lawmakers to limit the licensing of new for-hire vehicle drivers to address the glut of drivers, which has outpaced demand, led to an increase in unpaid down time, and contributed to congestion concerns. Limiting the number of drivers in a way that maintains quick response times but minimizes unpaid down time would allow existing drivers a better opportunity to make a living and right-size the fleet. The Guild opposes proposals to cap the number of for-hire vehicles because such a cap would cause vehicle and operation costs to skyrocket for workers.
In addition, the IDG is working to ensure members are protected by basic benefits. While the Guild opposes any new taxes that could further harm its members, if state lawmakers insist on a new rider surcharge, the Guild is demanding that it provide for a benefits fund for workers. Such a fund would give drivers access to benefits that would protect the public health and make our streets safer, such as paid sick leave, health, or vision plans.
“New York is positioned to lead the country and create a national model for fair working conditions for contractors, but there are only so many surcharges that can be put on the shoulders of our members and be supported. Any new surcharge must provide benefits to workers,” said Ryan Price, IDG’s Executive Director.
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The Independent Drivers Guild is an affiliate of the International Association of Machinists and Aerospace Workers and represents and advocates for more than 60,000 app-based drivers in New York City.