Ubers and Cabs Are About to Get More Expensive in New York
This post contains references to products from one or more of our advertisers. We may receive compensation when you click on links to those products. Terms apply to the offers listed on this page. For an explanation of our Advertising Policy, visit this page.
When New York City passed a series of laws in August to start regulating the ride-hailing industry, the contentious law and its effects were widely debated.
Most notably, the New York City Council passed a cap on new licenses for ride-hailing vehicles (e.g. Ubers and Lyfts). The body also said it planned to establish a minimum pay for drivers. And this Tuesday, the Council actually passed a law that would implement this new minimum wage-esque rule. While this is good news for drivers, especially since the gig-economy has made it much harder for people to earn a living wage, it also could mean significantly higher prices for consumers.
It’s expected that the new pay regulations will be implemented in January, which will give ride-hail drivers “a minimum hourly wage of $17.22 after expenses,” USA Today reports. The Independent Drivers Guild estimates that these workers currently make $11.90 an hour.
According to estimates from the New York City Taxi and Limousine Commission, 96% of NYC’s 80,000 drivers will see an increase in their net pay with the new law.
“Today we brought desperately needed relief to 80,000 working families,” Jim Conigliaro Jr., founder of the Independent Drivers Guild, said in a statement. “All workers deserve the protection of a fair, livable wage and we are proud to be setting the new bar for contractor workers’ rights in America.
Many Uber drivers have been subject to the pitfalls of the gig economy. Because drivers are classified as independent contractors, they don’t receive health insurance, have to pay for their own car repairs, gas and insurance and aren’t guaranteed a minimum level of income — no matter how much they work.
New York had seen a spate of ride-hail and cab driver suicides, with eight deaths in the last 12 months alone — many said the job’s stresses and low pay contributed to these tragedies.
And while it’s great that the drivers will see a living wage, the higher operating costs are likely to be passed onto the consumers.
In August, Alison Griswold, a journalist who covers the sharing economy for Quartz told TPG that “someone will have to pay for higher driver wages, and it’s possible that could be riders.”
“Ideally, the pay formula the city will implement will get companies like Uber to use their drivers more efficiently—i.e., so that drivers have passengers in the car for more minutes every hour,” she explained. “That would go a decent way toward raising their pay without the costs being passed along to the customer. But yes, it’s certainly possible prices will rise.”
Another tax is coming in January 2019 — New York is implementing a congestion pricing fee on all ride-hail and cab trips taken in certain areas of Manhattan. By law, the $2.50 surcharge for yellow cabs and $2.75 for for-hire vehicles will be passed along to passengers who take rides below 96th street in Manhattan
Photo by Ali Balikci/Anadolu Agency/Getty Images.
Sign-up Successful!
Welcome to The Points Guy!
Earn 90,000 bonus miles and 10,000 Medallion® Qualification Miles (MQMs) after you spend $3,000 in purchases on your new card in the first three months of card membership. Offer ends 11/10/2021.
With Status Boost™, earn 10,000 Medallion Qualification Miles (MQMs) after you spend $25,000 in purchases on your Card in a calendar year, up to two times per year getting you closer to Medallion Status. Earn 3X Miles on Delta purchases and purchases made directly with hotels, 2X Miles at restaurants and at U.S. supermarkets and earn 1X Mile on all other eligible purchases. Terms Apply.
- Limited Time Offer: Earn 90,000 Bonus Miles and 10,000 Medallion® Qualification Miles (MQMs) after you spend $3,000 in purchases on your new Card in your first 3 months. Offer expires 11/10/2021.
- Earn up to 20,000 Medallion® Qualification Miles (MQMs) with Status Boost® per year. After you spend $25,000 in purchases on your Card in a calendar year, you can earn 10,000 MQMs two times per year, getting you closer to Medallion® Status. MQMs are used to determine Medallion® Status and are different than miles you earn toward flights.
- Earn 3X Miles on Delta purchases and purchases made directly with hotels.
- Earn 2X Miles at restaurants worldwide, including takeout and delivery and at U.S. supermarkets.
- Earn 1X Miles on all other eligible purchases.
- Receive a Domestic Main Cabin round-trip companion certificate each year upon renewal of your Card. *Payment of the government imposed taxes and fees of no more than $75 for roundtrip domestic flights (for itineraries with up to four flight segments) is required. Baggage charges and other restrictions apply. See terms and conditions for details.
- Enjoy your first checked bag free on Delta flights.
- Fee Credit for Global Entry or TSA Pre✓®.
- Enjoy an exclusive rate of $39 per person per visit to enter the Delta Sky Club® for you and up to two guests when traveling on a Delta flight.
- No Foreign Transaction Fees.
- $250 Annual Fee.
- Terms Apply.
- See Rates & Fees
Disclaimer: The responses below are not provided or commissioned by the bank advertiser. Responses have not been reviewed, approved or otherwise endorsed by the bank advertiser. It is not the bank advertiser’s responsibility to ensure all posts and/or questions are answered.
Editorial Disclaimer: Opinions expressed here are the author’s alone, not those of any bank, credit card issuer, airlines or hotel chain, and have not been reviewed, approved or otherwise endorsed by any of these entities.