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NYC's new driver's law means that days of cheap Uber rides are over



Starting today, drivers for some ri hail apps in New York City will see a significant pay disturbance while drivers for other programs will not. In many cases, they will be the same driver since New York City drivers usually moonlight for multiple apps. If it sounds like a hot mess, it's because it's.

This confusion is the result of an 11-hour push by two companies, Lyft and Juno, to disrupt the implementation of a new law that gives higher salaries to drivers. According to the law implemented by the city in December 2018, which is scheduled to take effect today, the riding companies must pay drivers at least $ 1

7.22 an hour after spending. The payment formula uses a so-called utilization rate, which accounts for how much time a driver uses with passengers in the vehicles in relation to the idle time and waiting for a price.

Wednesday, Lyft and Juno initiated separate lawsuits claiming that the new law would put them at a competitive disadvantage for Uber. The exploit formula is unfair, they argue because Uber has more users and can keep drivers busier. The law will ultimately not succeed in increasing the driver's salary because it will push down the customers' needs, lift contends.

Both companies asked the judge to block the implementation of the law, but the judge initially rejected the request. Instead, fair-haired Andrea Masley, the New York State Supreme Court, offered the riding companies the opportunity to increase the earnings of the driver in a lock box lock account. Lift and Juno accepted, while Uber and Via did not. (Unlike some press releases, Lyft has not entered into an agreement with the city's Taxi and Limousine Commission.) This can be changed when Lyft and Juno are expected to reconcile with the judge on Friday.

However, Uber uses the legal battle as an opportunity to portray itself as a profit attorney. "We do not intend to hold back any part of the driver's earnings," a Uber spokesman said in a statement. A spokesman for Via agreed: "We also strongly believe that utility holding companies are an important step in reducing single-voyage congestion and we support TLC in this goal."

Uber does not ignore the fact that the new law will result in higher prices for riders. The company published two blog posts last night – one for riders, one for drivers – where the company means that the days of cheap Uber tours are over. Furthermore, trips starting in New York City and ending somewhere outside the five cities will include an additional fee to compensate the return travel drivers back to the city.

Essentially, the method used to calculate the new driver speeds involves a "roaming charge" where riders pay higher prices to compensate drivers for their time on the road without passengers. We believe that simple changes in the way the TLC applies the rule will allow us to reduce the prices of riders without affecting the minimum driver's charge of at least $ 27.86 per hour.

Uber said it would probably reduce or eliminate some of the financial incentives, such as limited time bonuses and promotions, that it used to lure drivers to their app. minutes to 15 minutes.

So what happens when Uber adheres to the new payroll and Lyft holds back some of that pay? The Taxi and Limousine Commission had no official comment on Friday, and Lyft's representatives are expected to meet again with Justice Masley to discuss the lockout agreement further. Lifting may eventually end up paying drivers some, if not all, of the higher pay levels. But the damage can already be done.

"Lifting drivers are so severely underpaid that it is only enforcing the minimum wage, will increase earnings by nearly $ 10,000 per year," said an independent driver's spokesman. "Shame on Lyft and Juno to prolong the suffering of their drivers – thousands of hard-working New Yorkers – and their families."

The fight for the new pay law can cost Lift his "fine guy" picture. The company previously associated with the fuzzy pink mushrooms has worked diligently to cultivate a reputation as the more "awake" alternative to the larger and more unsympathetic uber. And drivers certainly responded to that effort: According to a 2017 survey, 75.8 percent of Lyft drivers agreed that they were happy with their experience of running for Lift, while only 49.4 percent of Uber drivers could say it same.

Both Uber and Lyft are expected to be public this year, so cost control is certainly of great importance. To be sure, New York is just one market for the hundreds that both Uber and Lyft operate in. It also happens to be the largest in the United States, and other cities look closely to see how the payroll plays out. This can only be the top of the iceberg.


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