June 22, 2017
By Steven Wishnia
New York, NY – Three months after city taxi regulators announced they would propose a rule requiring all cab-hailing apps to include a way for passengers to give the driver a tip, Uber said it would modify its app to enable tipping.
The company announced June 20 that it had made tipping available in Seattle, Minneapolis, and Houston, and would extend it to all its U.S. drivers and delivery workers by the end of July.
To be able to receive tips electronically, drivers will have to download a new version of the Uber Driver app and click on the button that says “ACCEPT TIPS.” The app will then give the passenger the option to leave a tip after they rate the driver; they can pick $1, $2, $5, or a custom amount. Uber said it would not deduct any service fees from tips.
“Cuts to driver pay across the ride-hail industry have made tipping income more important than ever,” Independent Drivers Guild founder Jim Conigliaro Jr. said in a statement. “This is an important first step toward a more fair ride-hail industry.”
“Make no mistake, Uber only did this because members of the Independent Drivers Guild pressured regulators,” he added.
The IDG, a “works council” for Uber drivers affiliated with the International Association of Machinists, began urging the company to enable in-app tipping in June 2016, after drivers selected that issue as their top priority. Uber resisted the idea, so in February, the union petitioned the New York City Taxi and Limousine Commission to require ride-hail apps to offer an in-app tipping option. In April, the TLC announced it would develop such a rule.
“A Base Owner must provide a means to allow passengers to tip Drivers using the same method of payment that passengers use to pay for the fare,” says the draft rule proposed in May. That, the commission explains, means that if a company accepts payments by credit card, it must enable passengers to tip with a credit card. If it only takes cash, it would only be required to permit tipping in cash.
The proposed rule would also prohibit the base owner from keeping any part of tips given the driver, with a $500 fine for violations. A hearing on the proposed rule is scheduled for July 13.
City Council Transportation Committee chair Ydanis Rodriguez called the Uber announcement “welcome news,” but said in a statement June 20 that he would continue to pursue legislation to require all car-for-hire companies operating in the city to accept tips in the same form of payment they use to collect fares. That, he said, would “make sure companies cannot change their policies on a whim, and that future administrations cannot change rules currently under discussion,” and enable drivers to receive “easy-to-convey gratuities for their quality service.”
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