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Uber and Lyft have stopped accepting new drivers on their respective platforms in New York Metropolis, Politico stories. The transfer comes after the town handed new guidelines which can be designed to curb the explosive development of ride-hail corporations.

On its web site, Uber attributes the brand new coverage to “new [Taxi and Limousine Commission] laws.” (To seek out Lyft’s discover about not accepting new drivers, I needed to undergo the method of signing up as a brand new driver.) This can be a reference to laws handed by the New York Metropolis Council in December 2018, which requires ride-hail corporations to pay drivers at the very least $17.22 an hour after bills. The pay formulation makes use of a so-called “utilization fee,” which accounts for the share of time a driver spends with passengers of their automobiles in comparison with time spent idle and ready for a fare.

The foundations penalize corporations for operating too many automobiles with out passengers on metropolis streets. The upper an organization’s utilization fee, the much less it has to pay drivers to fulfill the brand new wage ground requirement. The foundations have been meant to extend pay for drivers, whereas additionally addressing what many noticed as an oversaturated market in New York Metropolis.

In that sense, in the present day’s information suggests the foundations are having their desired impact. The wage rule was handed a number of months after the town council accredited a brand new automobile cap for Uber and Lyft within the hopes of reversing worsening visitors congestion. That rule doesn’t have an effect on Uber and Lyft’s potential to onboard new drivers; it simply restricts the variety of automobiles that can be utilized to select up passengers.

Whereas wildly in style amongst riders, Uber and Lyft have been a supply of just about fixed grief for policymakers, incapacity advocates, taxi medallion holders, and labor teams. Critics complain that Uber and Lyft have been allowed to dominate the market with out having to comply with lots of the similar guidelines that apply to yellow taxis. This has led to a glut of drivers that has outstripped demand, driving down wages and rising visitors congestion. On the time, New York Metropolis’s regulation capping the variety of drivers was held up as a possible mannequin for different cities that wish to rein within the ride-hail trade.

Uber stopped onboarding new drivers in New York Metropolis on April 1st, adopted quickly after by Lyft. In January, Lyft sued the town to dam the brand new wage guidelines, arguing that they’d create an uneven taking part in discipline and would in the end imply their very own drivers can be paid much less. Three weeks later, Uber sued the town over the cap on new ride-hail drivers.

“As drivers exit the trade and demand from riders will increase, we’ll as soon as once more search so as to add new drivers,” an Uber spokesperson stated.

“Due to TLC laws, we’re presently not accepting new drivers in New York Metropolis,” Lyft stated. “We do have a waitlist and can let drivers know after they can apply to drive.”

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