App-Taxi Drivers Urge City to Require Tip Option

April 13, 2017 
By Steven Wishnia

New York, NY - If you ride an Uber taxi, you pay the fare electronically—but you can’t give the driver a tip through the app. A union representing Uber, Lyft, and other app-based taxi drivers is urging the city Taxi and Limousine Commission to change that, by requiring all ride-hail apps to give passengers an option to tip.

 The Independent Drivers Guild, an affiliate of the International Association of Machinists, filed a petition for such a rule with the TLC in February. The commission has until Monday, April 17, to approve, modify, or reject the proposed rule, says Machinists District 15 President James Conigliaro. 

Currently, yellow cabs in the city must give a tip option to people who use the touchscreen to pay by credit card. According to TLC data cited by the IDG, 97% of passengers who pay by credit card use that option, with the default tip 20% of the fare. Among app-based services, Lyft and Gett have a tip option. Juno passengers, however, can tip only if they give the driver a five-star perfect rating. Uber and Via don’t offer any tipping option, except for when people use the Uber app to hail yellow cabs.

“Since it’s made available on yellow cabs, there’s no reason it shouldn’t be available on black cabs and app-hail vehicles,” says Conigliaro. “It’s always been a part of drivers’ income.”

“On Uber, tips are not included, nor are they expected or required,” a company spokesperson says. “Riders tell us that one of the things they like most about Uber is that it’s hassle-free. Riders are free to offer tips and drivers are welcome to accept them, as has always been our policy.” But if passengers want to tip, they have to do it in cash.

The issue is important, the IDG says, because “Uber and Lyft have both slashed driver pay in a race to the bottom.” Uber, for example, has cut its base fares by 12.5% to 68% since 2011. The union estimates that more than half its members make less than $50,000 a year—and that’s before expenses such as gas, maintenance, and leasing a car, which typically costs more than $20,000.

Tipping is not the solution to drivers’ pay problems, Conigliaro says, but it would help. The IDG estimates that if app-based drivers got tips at the same average as yellow-cab drivers, it would increase their income by $12,000 a year.

“Industry-wide, workers are missing out on tens of millions of dollars per year necessary for vehicle upkeep and supporting their families in one of the most expensive cities in America,” said a letter the IDG delivered to the TLC. It was also signed by Public Advocate Letitia James; city Comptroller Scott Stringer; a dozen City Councilmembers, including Transportation Committee chair Ydanis Rodriguez; and several unions, including the New York State AFL-CIO, the New York City Central Labor Council, and Transport Workers Union Local 100.

Mayor Bill de Blasio’s administration, however, has not endorsed the rule. “The TLC is actively reviewing the petition and has also been taking a close look at driver economics across all the industry sectors it regulates, including holding a hearing last week on the economics of the for-hire vehicle and taxi industries,” spokesperson Austin Finan told LaborPress. “Difficulty getting tips for some drivers who work for app companies was one of the many issues raised and one we’ll continue to look at.”

The union began trying to get Uber to add a tip option last May, after drivers named it as their top priority, says Conigliaro. But the company was “unwilling to move on the issue.”

The IDG’s campaign for it, he says, has included printing flyers on cocktail napkins and distributing them to bars, where people often use ride-hail apps. More than 11,000 people have signed a petition urging Uber management to “add an easy tipping option.”

At the TLC hearing Apr. 6, the union also urged the panel to set minimum per-mile and per-minute fares; give drivers an appeals process for when challenges to fares reduce their pay; and limit the number of taxi drivers licensed and luxury for-hire vehicles permitted on the road, to alleviate what Conigliaro calls the “saturation of the industry.” But the union is concentrating on the tip issue for now, he says, because “you have to focus on one thing at a time.”

If the TLC approves the tip-option requirement or a version of it, it would then have to go through the city’s rule-making process, including a public hearing, before it can go into effect. That process typically takes 90 days.

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