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Uber, Lyft drivers need minimum pay standard, according to TLC report

A salary earnings floor of $17.22-per-hour would mean a 22.5% jump in wages after expenses, economists from The New School and UC Berkeley found.

Uber, Lyft and other for-hire drivers need a

Uber, Lyft and other for-hire drivers need a minimum pay standard as current rates equate to only a $15-per-hour minimum wage, according to a Taxi & Limousine Commission study. Photo Credit: Getty Images / nycshooter

A report released Monday by the city’s Taxi and Limousine Commission advocates for a minimum pay standard for Uber and Lyft drivers.

The report by The New School and UC Berkeley economists said if the city set a salary earnings floor of $17.22 an hour, a for-hire driver’s net earnings — after expenses — would jump by 22.5 percent, or an average of $6,345 per year. Researchers said the current pay model, equivalent to a $15-an-hour minimum wage, doesn’t come close to this rate.

“Hourly pay is low in large part because the industry depends upon a ready availability of idle drivers to minimize passenger wait times,” the report said.

Drivers, transportation advocates and City Council members have pushed for a standard minimum wage to ensure fair pay for the growing number of for-hire motorists — many of whom are considered independent workers by the ride share companies.

The study said there are more than 80,000 for-hire vehicles in the city, compared to 13,587 medallion yellow cabs. For-hire drivers complete more than 17 million trips in the city each month.

“Uber alone would be the largest for-profit private employer in New York City — if Uber drivers were classified as employees rather than independent contractors,” the report said.

Researchers said the impact on riders would be minimal as fares would only increase 5 percent or less, and average wait times for passengers would go up by about 12 to 15 seconds. Drivers would also be more enticed to accept shared rides, according to the study.

A spokesperson for Uber, however, said the proposal would lead to higher prices for riders and reduced service.

“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,” the spokesperson said in a statement.

A representative for Lyft argued that the policy would lead to serious problems on the streets.

“We have not yet reviewed the full report, but the new proposed policy appears to create financial incentives for drivers to provide less service. 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,” Lyft spokeswoman Campbell Matthews said in a statement.

Bhairavi Desai, executive director of the New York Taxi Workers Alliance, also had concerns over the wage proposal. The report didn’t call for a wage floor for other livery and other drivers and doesn’t prevent the for-hire companies from implementing a wage ceiling, she said.

“The only way forward is to look at the industry holistically and implement one set of policy solutions that will help drivers in every sector,” Desai said in a statement.

The TLC is drafting regulatory rules to implement the minimum pay standard policy and said it will release the draft rules for public comment soon.

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