NYC taxi commission recommends pay raise for Uber, Lyft drivers

NYC taxi commission recommends pay raise for Uber, Lyft drivers
© Greg Nash

A new study commissioned by New York City regulators says that Uber and Lyft drivers should be making at least $17.22 an hour.

The recommendation is the independent-contractor equivalent of a $15 minimum wage with paid time off.

The study was conducted by economists James Parrott of The New School and Michael Reich of the University of California, Berkeley for the New York City Taxi and Limousine Commission (TLC).

“The standard would ensure that drivers’ overall pay provides for all vehicle expenses as well as a fair amount for the drivers’ time and also some paid time off,” Parrott and Reich wrote.

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The TLC will release a public draft of proposed rules for public comment soon. The proposal would apply to drivers for Uber, Lyft, Via and Juno.

The industry attacked the report Monday, saying the proposal would incentivize drivers to work less.

Campbell Matthews, a spokeswoman for Lyft, said the company gives its drivers “valuable, flexible earning opportunities.”

“We have not yet reviewed the full report, but the new proposed policy appears to create financial incentives for drivers to provide less service,” Matthews said in a statement to The Hill. “As a result, there will be more empty cars, more congestion, longer wait times for passengers, and, over time, less pay for drivers in New York City. This would be a bad outcome for all New Yorkers, and Lyft is committed to working with policymakers to find a better solution."

An Uber spokesperson added in a statement, "We are concerned about the unintended consequences of implementing the findings in this report and believe many of the assumptions made about our industry are over-simplified to the point of flawed.” 

According to the study, two-thirds of the drivers in the city for the ride-hailing apps rely exclusively on driving for their income, and 85 percent make less than the recommended minimum.

Those in the 85 percent, an estimated 50,000 drivers, would see a 22.5 percent annual net pay increase, an average of $6,345 a year.

Parrott and Reich also found that 90 percent of app drivers are immigrants. According to the economists, 40 percent of drivers have incomes low enough to qualify them for Medicare.

“These drivers, many of whom cannot obtain better-paying job options elsewhere in the New York economy, face difficult economic circumstances,” they wrote. “Their low pay has persisted despite the rapid growth of the industry, the major benefits it has provided to consumers, and the high returns it has generated for the companies and their external investors.”

Updated: 3:50 p.m.