Roughly 80,000 for-hire vehicle drivers in New York City are expected to get a pay raise next year. The city’s Taxi and Limousine Commission on Tuesday voted to secure a minimum wage for drivers with ride-hailing companies, including Uber, Lyft, Via, and Juno, making New York the first city in the world to do so. Going into effect in 30 days, the new rule mandates a minimum wage of $17.22 per hour, after expenses. That hourly rate is equivalent to the city’s employee minimum wage of $15 per hour, which will be set at the end of this year.
“New York City is the first city globally to recognize that the tens of thousands of men and women who are responsible for providing increasingly popular rides that begin with the touch of a screen deserve to make a livable wage and protection against companies from unilaterally reducing it,” Meera Joshi, the chair of TLC, said in a statement.
The minimum wage law was included in a package of legislation approved this summer by the City Council. In addition to the wage bill, the package included a one-year cap on new licenses on for-hire vehicles.
Uber and Lyft opposed the legislation and warn that riders will have to pay higher fares for shared rides. A spokesperson from Uber told the New York Post: “The TLC’s implementation of the City Council’s legislation to increase driver earnings will lead to higher-than-necessary fare increases for riders while missing an opportunity to immediately reduce congestion in Manhattan’s central business district.”
The rule comes after a University of California, Berkeley report found 96 percent of high-volume for-hire vehicle drivers earn less than $17.22 per hour, while also seeing their median earnings decline more than 10 percent between 2016 and 2017. According to the report, drivers spend an average of $425 per week on the operation of their vehicles and as independent contractors, receive no benefits or paid time off.
Drivers will now be paid based on a formula that sets a per-minute and per-mile minimum payment. The TLC said this will provide 96 percent of Uber, Lyft, Juno, and Via drivers in the city nearly $10,000 more per year. Wheelchair accessible taxi owners will also receive payments of $14,000 per year for putting a car on the road and another $4,000 per year while in service.
“App based drivers will now earn at least the equivalent of the City’s minimum wage, bringing more fairness to a gig economy that too often leaves working people behind,” Council Speaker Corey Johnson said. “The Council is proud of the progress we have made and will continue working to help drivers, reduce congestion, and increase fairness in the for-hire vehicle industry.”
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