Tuesday, 23 April, 2019

Uber and Lyft trips just got more expensive in NYC. Here's why

Bloomberg
A Lyft Inc. decal is displayed on a car window Bloomberg A Lyft Inc. decal is displayed on a car window
Priscilla Morrison | 04 February, 2019, 04:15

In addition, because the rule requires the company to compensate drivers for their return trips after taking riders outside the city, some out-of-town fares will incur a surcharge.

The ride hailing companies Juno and Lyft are suing New York City to block a new minimum wage law for app-based drivers that was set to go into effect on Friday.

Rideshare apps Lyft and Juno are fighting a new city rule that will force them to pay their New York City drivers minimum wage.

The ride-hailing companies classify their drivers as independent contractors, meaning that they, like their counterparts in taxis, have been excluded from many federal labor protections, including the right to unionize, and from local protections like the city's $15 minimum wage for workers at companies that employ more than 10 people.

Both Lyft and Juno have criticized the formula as benefiting Uber, which is by a huge margin the largest of the three main ride-hail operators.

"It's no secret that Uber has tried to put us out of business in the past", Matthews continued.

Lyft Inc.is also raising prices, and also citing the new minimum wage.

Via, also one of Uber's smaller competitor in New York City and the only one with a higher utilization rate due to its high percentage of shared rides, said it also supports the new minimum wage rules.

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Juno argues in a separate suit that even if the utilization rule was not inherently unfair, it is still based on flawed data. The Independent Drivers Guild, which represents more than 70,000 ride-hail drivers in New York City, said it believes these lawsuits are just a ruse to not pay drivers more. Passengers will now have five rather than two minutes to arrive at the pickup point, but drivers will get paid more for the time they spend waiting after that.

Judge Andrea Masley set a March 18 hearing for the lawsuit and in the meantime offered app-based ride-hailing companies the option of placing the additional pay in escrow. It will make it more hard for smaller companies to compete on prices and payment for drivers, as well as continue to service less populated areas, the petition said.

New York City Mayor Bill de Blasio tweeted his opposition to the Lyft and Juno lawsuits, calling them "unconscionable". He said keeping the raise out of those drivers' pockets would backfire on the companies by creating a "competitive advantage for Uber". For some rides, Lyft might pay less than the required minimum, if other rides make up the difference.

Although Judge Masley offered Uber the opportunity to similarly withhold pay, Uber says, "we notified the Taxi & Limousine Commission and the Court that we do not intend to hold back any portion of drivers' earnings".

The minimum-wage rule is part of Mayor Bill de Blasio's effort to cap the growth of the app-based auto services and reduce traffic congestion.

Juno didn't immediately provide a comment.

The Lyft case is Tri-City LLC v.

New York's Taxi and Limousine Commission said its concerned by the court's allowing Lyft and Juno to withhold funds from drivers. The Juno case is Omaha LLC v.

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