NYC Slams Uber, Lyft for ‘Disinformation’ on Driver Pay Hike

(Bloomberg) — New York City’s rideshare regulator said Uber Technologies Inc. and Lyft Inc. are “spreading disinformation” in emails sent to drivers and riders about proposed rules that would give drivers a roughly 6% pay hike.

NYC’s Taxi and Limousine Commission, or TLC, which regulates yellow cabs and rideshare vehicles, rebuked the companies in messages posted to Facebook and X on Friday in response to recent email campaigns from Uber and Lyft. The two firms are urging workers and customers to write to the commission to oppose the proposal, which is set to be discussed at a public hearing on Feb. 5.

The city is pushing to revise its minimum pay rule in such a way that would deter Uber and Lyft from locking drivers out of their apps, which the firms routinely did last summer to erase some of the drivers’ working time from the record. This allowed Uber and Lyft to game the city’s pay rule and save millions in future compensation, a Bloomberg investigation last October found. 

Uber has pushed back against the new rules, after having petitioned the regulator to instead cut driver pay in one of its biggest markets in the US. A company spokesperson said earlier this month the firm was considering all options, including litigation, to fight the plan.

In an email titled “Tell the TLC Not to Force You Offline” and sent to drivers on Thursday, Uber said it may no longer dispatch vehicles that are five years or older if the new rules are passed. “Tell the TLC they must reconsider this rule immediately and not take any action that will force you to buy a new car every five years,” Uber’s message read. 

Underpinning Uber’s argument was the idea that the commission’s justification for raising rates assumes a vehicle used for providing rideshare services would likely be fully depreciated after five years with minimal resale value. 

In arriving at its proposed 6.1% pay hike, the commission took into account the cost required to maintain or replace a car over five years, but the proposal does not require drivers to actually do so.

“We respectfully disagree with the TLC’s characterization of our message to drivers,” Uber spokesperson Josh Gold said. “If rates are paying for newer cars, riders should get newer cars. We encourage the TLC to reconsider its approach and engage with drivers who rely on their vehicles well beyond five years to earn a living.”

The New York Taxi Workers Alliance, a group that represents more than 28,000 drivers, told its members in a text message Thursday that Uber is “trying to trick drivers into testifying against your own raise.” 

Uber is “grasping at the straws” with ways to diminish driver pay, said Zubin Soleimany, an attorney with the alliance. “It is completely false and cynical,” he said.

In a separate email to customers on Wednesday, Lyft said the city’s proposed rules will mean “more fare hikes” and make “rideshare needlessly expensive,” calling on riders to sign a petition to push back on the proposal.

“The proposed driver pay increase WOULD NOT force them to increase fares or stop dispatching vehicles older than 5 years,” TLC said in its Facebook post on Friday. “Neither is a requirement of our rule package. Such unnecessary actions would be entirely their choice.”

“It’s inevitable that a rate hike like the one being proposed would increase rider fares and mean fewer rides for drivers,” said Lyft spokesperson CJ Macklin. “That’s because the city’s driver pay formula is fundamentally broken, and the TLC’s proposed ‘solution’ only makes it worse.”

In addition to the possibility of higher driver pay in New York City, the two rideshare companies face an antitrust probe from the US Federal Trade Commission on whether they illegally coordinated to limit driver compensation, according to documents seen by Bloomberg News.

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