Over the past couple months, “lockouts” from Uber and Lyft have led to several protests and staunch criticisms from Mayor Eric Adams, Taxi & Limousine Commission (TLC) Chair David Do, members of New York’s City Council and industry advocates. Lockouts occur when either Uber or Lyft fear their utilization rate (UR) could fall below the annual 53% threshold, which could trigger significant financial penalties.
The TLC describes URs as, “the percentage of time that high-volume drivers are transporting passengers. TLC uses the utilization rate in driver minimum pay formulas to incentivize companies to utilize their driver pool more efficiently. It is calculated by dividing the time spent with a passenger by the total time that drivers are logged into the app, including time waiting for a dispatch, time en route to pick up a passenger, and time with a passenger.”
The TLC – and David Do in particular – should be commended for their work in recent years seeking to protect the financial stability of their licensed drivers and I would like to thank Mayor Adams for addressing this issue directly at a recent “Driver Appreciation and Family Day,” where he spoke to a massive crowd of New York City Uber and Lyft drivers… but maybe we should take a step back, rather than just pointing fingers.
If you have read my editorials over the past decade, it’s pretty clear how I feel. I have been sharply critical of the way Uber and Lyft steamrolled their way into New York City, and I’ve had major issues with the way they have run their businesses – but, in this instance, I think there is plenty of blame to go around. I don’t think it’s fair to lay all of the blame on companies that exist to earn a profit.
Media outlet, AutoMarketplace, has been encouraging the TLC to drop the UR altogether, instead focusing on “controlling for-hire driver and vehicle supply.” According to AutoMarketplace, “NYC can control the total number of for-hire vehicle licenses on its streets. No other market in the US can do this. If you properly control the number of drivers and vehicles who can service trips… This is why the taxi medallion system was created in the first place. To protect driver earnings. NYC has already solved the problem. They just need to enforce pre-existing rules and regulations! Drop URs, keep minimum per mile and per minute rates, and enforce the FHV License Pause.”
I honestly am not sure that’s the answer, but it’s clear the current situation is untenable. Uber and Lyft seemingly feel boxed in by the UR rule and drivers are suffering financially from these harsh lockouts.
Commissioner Do recently told Bloomberg, “There are a variety of rules that we are going to be using to strengthen the pay standard for drivers. We want to say that the regulator is here, that we are on the side of drivers and that we will impose new rules and new restrictions on the high-volume companies if we need to ensure that they’re playing fair.”
Do offered a vague timeline of “the next couple of months” for presenting these updated rules, adding that the TLC has been in talks with Uber and Lyft to see if it can address the lockouts without implementing a rule change. He also accused the companies of creating a “manufactured crisis” by onboarding too many drivers.
Uber responded by saying they began limiting new driver sign-ups last April to include only drivers with electric or wheelchair-accessible vehicles. They say they did this to meet the goals brought on by the city’s Green Rides Initiative, which seeks to require all Uber and Lyft trips be conducted by either zero-emission vehicles (ZEVs) or wheelchair-accessible vehicles (WAVs) by 2030.
This is where it gets tricky… because both sides of this argument make sense to me. I fully support any initiative that addresses climate change, but the Green Rides Initiative always seemed a little extreme, even to me. After a lengthy FHV license cap, the TLC briefly opened the floodgates to more licenses, but only for ZEVs and WAVs – and the TLC saw about 10,000 new EV plate applications in a very short span of time, before the cap was reinstated. Could this be part of what is causing the latest rash of lockouts? Possibly… but it’s not a question that currently has an answer I would state as FACT.
In the meantime, as has historically been the case, our industry’s hard-working TLC-licensed drivers are caught in the middle – but unlike many instances in the past, they quickly began joining forces and fighting back. Whoever is at fault, they surely didn’t cause this mess, but they are the ones suffering… so I strongly encourage them to keep up the fight until this is resolved.
The reports I’ve read say Uber started restricting NYC TLC drivers in mid-May, while Lyft launched its driver lockouts in mid-June. Industry advocates were quick to assemble massive groups of drivers, beginning most prominently with a caravan of hundreds of drivers, assembled by the Justice for App Workers coalition and the Independent Drivers Guild (IDG), which began in Queens, crossed the Queensboro bridge into Manhattan, came back across the Queensboro Bridge and circled Uber’s NYC driver office at the Falchi Building. A protest rally was also held outside Uber’s office, with an estimated 600 drivers participating. To his credit, Commissioner Do attended the rally and pledged to work with the organization on solutions to the “lockout crisis.”
“As drivers licensed to operate in New York City, we pay thousands annually for licensing and insurance,” stated Aziz Bah, organizing director for the IDG. “Many of us have invested our savings and taken out loans to join this industry. It’s completely unfair for an app company to be able to disrupt our livelihoods at a moment’s notice. The Independent Drivers Guild will not stop fighting until drivers are back on the road! And we’re glad to see the Mayor feels the same.”
Another industry group, the New York Taxi Workers Alliance (NYTWA) assembled a massive throng of Uber and Lyft drivers on July 17, that rallied at City Hall, then marched to Uber’s New York City headquarters to demand an immediate end to “lockouts.”
“We now have a crisis of oversaturation and instead of paying the drivers for that empty time, the companies are instead punishing the driver,” the organization’s founder and executive director, Bhairavi Desai, said, adding “if their demands are not met, the drivers are prepared to escalate their campaign, up to and including a full-blown strike.”
Just a few days later, on July 20, the IDG held its annual Driver Appreciation and Family Day Event at Flushing Meadows Corona Park in Queens, bringing thousands of NYC Uber and Lyft drivers together for free food (with Halal option), giveaways, and “fun activities for the whole family.” Notably, Mayor Adams, the TLC’s David Do and representatives from some of the industry’s most important organizations – like The Black Car Fund and Driver Benefits – were in attendance.
In his address to the crowd, Mayor Adams said: “This administration is committed to honoring the service of our for-hire drivers and delivery workers, who are the backbone of our city. That’s why our administration has increased wages for tens of thousands of drivers, fought companies denying them fair pay, and made it easier for these workers to operate their own businesses. Thank you to the Black Car Fund and the Independent Drivers Guild for their groundbreaking work.”
It’s great to see that our industry’s drivers seemingly have the support of the city’s real decision-makers, going all the way to the top. The problem is, tragedies unravel quickly but solutions often take time. I just hope something can be done to ease the pain of people who simply don’t deserve this crap.
