New York Votes to Increase Minimum Wage for Lyft, Uber Drivers

By: Bridget Clerkin December 21, 2018
Although drivers are no doubt thrilled about the increase in wages, Uber and Lyft caution that customers could see an increase in rates and wait times.
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Drivers across the Big Apple received one heck of an early Christmas present this year when a special commission in New York City voted to officially raise their pay rate.

The holiday bonus was far from a pittance, too.

Those piloting vehicles for Uber, Lyft, and other app-based services within city bounds will see their pay rise to $27.86 an hour following the action from the New York City Taxi & Limousine Commission (TLC). The figure factors down to $17.22 after expenses, or the equivalent $15 per hour for an independent contractor, after costs like paid sick leave and payroll taxes are accounted for, according to the TLC.

That puts the drivers in line with other workers across the city, who are due to begin reaping the same minimum wage by the end of 2019.

The move is projected to impact more than 80,000 for-hire drivers across NYC, who will start picking up the extra earnings by the end of the year.

The move is projected to impact more than 80,000 for-hire drivers across NYC, who will start picking up the extra earnings by the end of the year. All told, it’s anticipated to add nearly $10,000 to a driver’s annual salary. A previous report filed by the commission found for-hire drivers were taking home, on average, $11.90 an hour.

Further rules stipulated by the TLC’s latest measure will require app companies to be more transparent about how they calculate pay and car leasing expenses.

The move was lauded by a number of driver and labor groups, including the sometimes-rivals New York Taxi Workers Alliance and the Independent Drivers Guild, both of which have a long history of fighting for increased driver pay—and against corporate attempts to swindle employees and riders alike.

Still, not everyone was happy with the idea, including Uber and Lyft.

The companies put out a pair of similar statements claiming to support the concept of a livable wage.

But instituting the new commission-required rate would “undermine competition” and “disincentive drivers,” according to Lyft, and “lead to higher-than-necessary fare increases for riders,” according to Uber.

Lyft said that initiating such a big switch in the 30-day window before year’s end would be next to impossible.

Yet at least one person remained a true believer: TLC Chair Meera Joshi, who predicted that New Yorkers would happily rally around their fellow workers.

“Companies are saying paying drivers fairly will cause longer wait times and higher prices,” he said in the group’s release on the vote. “But I believe all New Yorkers are willing to pay a little more and wait a little longer so the people transporting them are able to provide for themselves and their families.”

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