Uber and Lyft drivers throughout the five boroughs will see a pay increase of about $9,600 each per year after the Taxi and Limousine Commission voted on new minimum wage standards for New York City rideshare drivers.
Commissioners voted seven to one to approve the new wage rules for app-based for-hire vehicle drivers on Tuesday, giving more than 80,000 New York City rideshare drivers who rely on work through apps like Uber and Lyft access to more take-home pay.
The move makes New York City the first in the nation to regulate app-based for-hire rideshare drivers and establish a minimum wage for Uber and Lyft drivers.
The Independent Drivers Guild, a union of rideshare drivers, says the decision sets an important precedent and hopes other cities quickly follow suite. The pay rules will go into effect within 30 days.
Rideshare drivers, as contractors for apps, are not protected by minimum wage laws across the country. In New York City, app rideshare drivers make $11.90 per hour in take-home pay according to an Independent Drivers Guild analysis — below the city’s minimum wage of $13 (New York City minimum wage is going up to $15 at the end of the year).
Now that the TLC has passed the new pay rules, rideshare drivers will see “an average 44.7 percent increase in take-home pay or about $9,600 annually per driver, or from $11.90 net per hour to $17.22 net per hour,” according to the commission.
The new rules regulate that New York City rideshare drivers are paid according to a minimum-per-trip formula that takes into account total working time, meaning time spent driving passengers, waiting for a ride and also driving to pick up passengers. The rules also include a “Shared Ride Bonus” so drivers aren’t undercut on shared trips, and out-of-town pay to compensate return trips when drivers drop off passengers outside the city.
Uber, Lyft minimum wage: What's next for NYC rideshare drivers?
The move has been praised by the Independent Drivers Guild, the New York Taxi Workers Association, the Amalgamated Transit Union and more, with activists saying ensuring minimum wage is a step toward increasing all drivers’ quality of life.
“While the city still has a long way to go to ensure that Uber and Lyft drivers are treated fairly and respectfully by their employers, increasing the take-home pay for rideshare drivers is an important step in creating livable conditions for drivers and curbing the tragic spate of suicides that have stolen our fellow drivers from us this year,” said Lawrence Hanley, International President of the Amalgamated Transit Union, in a statement.
The Taxi Workers Association, which represents New York City rideshare drivers and yellow and green cab drivers, considers the TLC vote a victory, but they say ultimately it's still not enough.
“It’s a long time in the making, and it’s the first real attempt at stopping rate cuts, which has been an Uber-Lyft business practice that’s been at the heart of a lot of the poverty wages for drivers,” Bhairavi Desai, NYTWA executive director, told Metro ahead of the vote.
But the NYTWA says that city officials need to regulate Uber and Lyft passenger rates, guarantee that app rideshare drivers get 80 percent of those rates and regulate the yellow and green taxi meters so that they charge the same minimum rates.
Those changes, Desai said, would allow drivers across the industry — including yellow and green taxi drivers — to earn a raise.