On the brink of Uber's Wall Street debut, drivers in Seattle joined protests across the country demanding that Uber & Lyft pay drivers a living wage.
Ride-hail companies Uber and Lyft are pocketing an increasing share from what passengers pay while drivers are earning less, according to a new report released today by the App-Based Drivers Association.
The study – based on analysis of company financial reports, combined with never before released trip-level data collected by local drivers in Seattle – was released at a Driver Speak Out event attended by drivers at the Sea-Tac Airport waiting lot.
“As drivers, we make sure our customers get to their destination safely, and we bear all the costs of car, gas, maintenance, repairs – everything,” said Don Creery, who has been driving for Uber for 5 years. “But over the years Uber has been taking more and more from what passengers pay, and now they’re telling investors they plan to reduce driver pay even further to satisfy shareholders. It’s just not right.”
The Speak Out event was one of more than a dozen driver-led actions in major metropolitan areas happening just ahead of Uber’s highly anticipated debut on Wall Street, which is expected to draw a valuation that could top $100 billion. But, while Uber’s IPO may be poised to mint a new generation of overnight tech millionaires, the data shows that drivers are being paid a declining share of what customers are charged.
When Uber and Lyft first came to Seattle, drivers were paid 80 percent of what riders were charged. Today, on the median trip in Seattle, drivers received just 69 percent, according to the ABDA report. And the more riders pay, the less drivers receive.
On a majority of trips analyzed, riders paid higher prices than advertised non-surge UberX rates. On these high-priced trips, drivers received just 62 percent of rider price – the company take was 38 percent. On some trips, driver pay fell to as little as 32 percent of what customers were charged.
Uber and Lyft’s take rates are high relative to other online marketplace platforms.
Paypal charges users 2.9% plus $0.30. Etsy charges merchants 5% plus a listing fee. Mercari charges sellers 10%. Ebay fees are between 2%-12% of sale price. AirBnB fees for hosts and guests combined range between 3%-23% of listing price.
“Consumers deserve price transparency to know that at least 80 percent of what they pay is shared with their driver, not kept by the company for overhead or profits,” said Peter Kuel of the App-Based Drivers Association, who has been an Uber and Lyft driver for 5 years. “Uber and Lyft should meet the same standards of every other business in town, ensuring that drivers can earn paid sick days and never receive less than a $15 minimum wage after expenses.”
See media coverage of the event:
- SEATTLE TIMES: As Uber and Lyft go public, Seattle drivers getting a smaller share of fares, union analysis says
- KING 5: Uber/Lyft drivers protest pay
- KNKX: Ride-share drivers rally at Sea-Tac over low pay before Uber IPO
- GEEKWIRE: Uber driver protests ahead of IPO spell uncertain future for gig economy
- KIRO 7: Local Uber, Lyft drivers protest low wages as others across country strike
- KOMO 4: Uber, Lyft drivers protest in Seattle, across the US
- KING 5: Seattle Uber, Lyft drivers to protest pay amid nationwide strike
- Q13: Uber, Lyft drivers go on strike to protest low pay, event planned at Sea-Tac Airport
- AL JAZEERA: Uber, Lyft drivers strike in cities worldwide ahead of Uber's IPO
- SEATTLE CHINESE TIMES: 隨著Uber和Lyft上市 司機的工資將會愈來愈少？
Seattle Uber and Lyft drivers will hold a Driver Speak Out! event and press conference on Wednesday to highlight increasingly high company take rates, low driver pay, issues around deactivation and other driver concerns as Uber prepares to go public later this week.
At the event, members of the App-Based Drivers Association will discuss a new report that exposes how Uber and Lyft are pocketing an increasingly greater share of rider payment in the Seattle market while drivers are earning less.
The study, Uber/Lyft take more, pay drivers less, is based on analysis of company financial reports, combined with never before released trip-level data collected by local drivers in Seattle.
The Driver Speak Out! will take place at the Sea-Tac Airport Ride Hail Lot (3037 160th St) on Wednesday, May 8, 2019 starting at 11 a.m.
The Seattle event will be held in conjunction with driver protests in other major metropolitan areas around the country in anticipation of Uber’s much-anticipated debut on Wall Street, which is expected to draw a valuation that could top $100 billion. Strikes and other actions are planned in San Francisco, Los Angeles, San Diego, Chicago, Boston and Washington, D.C.
Uber and Lyft drivers attending a Driver Summit event today sponsored by the App-Based Drivers Association got a first look at a Rideshare Wage Calculator developed in partnership with Teamsters 117. The new tool, which can be accessed at www.drivercalculator.org, deducts common expenses such as gas, vehicle maintenance, and insurance from a driver’s weekly gross earnings to calculate estimated hourly pay. Drivers can compare their pay to the Seattle minimum wage and other types of jobs.
"The Rideshare Wage Calculator gives you a realistic calculation of your pay."
“The Rideshare Wage Calculator gives you a realistic calculation of your pay,” said Hari Lama, who has driven for Uber and Lyft for two years. “It reflects my experience that our pay has been decreasing over time and that the commission rates these companies are taking are too high. We need to be compensated fairly so we can earn a living wage.”
The methodology used to develop the Calculator is based on the work of Larry Mishel, a distinguished fellow at the Economic Policy Institute, who analyzed driver pay in his report Uber and the Labor Market published earlier this year. "It is important that every 'rideshare driver' accurately assess their earnings and be able to compare them to other workers on an apples-to-apples basis. This wage calculator provides just that tool," Mishel said.
Drivers at the meeting brought their concerns over high commission rates, decreasing pay, deactivation, and a lack of protection for workers to Seattle City Councilmember Teresa Mosqueda, who committed to work with others on the Council to develop new policies to raise standards in the industry.
“We need to establish policies to ensure that drivers in the for-hire transportation industry enjoy the same rights and protections as other workers in our City – the right to free association, the right to stand together in a union, and protections by Seattle’s sick and safe leave and minimum wage laws,” Councilmember Mosqueda said.
In April, the City Council passed a resolution to study data in the for-hire industry and explore equitable compensation for drivers, improve customer service, and ensure equal market access to all stakeholders. “Uber income is going down and our expenses are going up,” said Abebe Ephrem, who has been driving for Uber and Lyft since they entered the Seattle market in 2012. “The drivers have lives, they have apartments, they have families. The City needs policies so that we can be treated with respect, like human beings.”
Uber is near the top of companies in Washington State whose workers rely on food stamps to feed their families. According to a recent study by JP Morgan/Chase, average monthly earnings among active for-hire drivers in the first quarter of 2018 were 53 percent lower than their peak in the first quarter of 2014.
“The public should not be subsidizing billion dollar companies in a race to the bottom in driver pay,” said John Scearcy, Secretary-Treasurer of Teamsters 117. “Seattle needs to follow New York's lead and pass legislation to guarantee that drivers can earn a living wage.”
Drivers Call on City to Take Action to Pass a Driver/Passenger Bill of Rights
Drivers in Seattle’s for-hire industry expressed frustration at today’s ruling by the federal 9th Circuit Court of Appeals that partially reverses a lower court’s decision to uphold Seattle’s collective bargaining law.
“Drivers are deeply disappointed with today’s decision, which continues to delay our right to unionization,” said Don Creery, an Uber and Lyft driver and member of the leadership council of the App-Based Drivers Association (ABDA). “Anti-trust laws were put in place to protect the little guy from monopolistic practices from large corporations, not to shield a company like Uber – valued at over $70 billion – from negotiating with its workers over fair pay and working conditions.”
"Drivers have already waited for years for fair pay and the right to a union."
Drivers called on the City of Seattle to enact new policies to protect drivers, level the playing field in the industry, and ensure that drivers can earn a living wage. “Drivers have already waited for years for fair pay and the right to a union. Today’s court decision emphasizes the urgent need for the Seattle City Council to step in to improve pay for drivers and pass a Driver/Passenger Bill of Rights,” Creery said.
Because of their disputed status as independent contractors, for-hire drivers who work for Uber and Lyft have not been protected by traditional labor laws or state and local laws, such as Seattle's $15 an hour minimum wage law and Washington State’s new paid sick leave law. In April, the City of Seattle passed a resolution to study the industry and consider regulations that could lead to better pay and other protections for drivers.
In 2014, Uber and Lyft drivers sought assistance from Teamsters Local 117 to improve their pay and working conditions. In May 2014, drivers established ABDA to promote fairness, justice, and transparency in the for-hire industry.
“We are disappointed by the Court’s ruling that continues to block drivers from having a voice,” said John Scearcy, Secretary-Treasurer of Teamsters Local 117. “Like other working people in this country, for-hire drivers should have the same freedom to stand together in their union to improve their pay and working conditions. We will continue to stand with drivers for their right to unionize, earn a family wage, and to raise standards in the industry.”
Drivers Call on Uber to Stop Efforts to Block their Right to Have a Voice
Seattle for-hire drivers who are seeking to unionize under the city’s new collective bargaining law applauded a federal judge’s ruling to dismiss a lawsuit filed by the U.S. Chamber of Commerce challenging the law.
“We’ve been waiting for this day, waiting to join the union and to have the right to negotiate with Uber,” said Mustafe Abdi, who has been driving with Uber for three years.
Abdi, who is a member of the App-Based Drivers Association (ABDA), listed a number of concerns he and other for-hire drivers would like to address at the bargaining table. “We need to talk about the rates and deactivation and other things. We don’t have medical, we don’t have retirement. We don’t have Social Security. We don’t feel safe when we drive our cars. This is good news for all drivers in Seattle.”
As independent contractors, Seattle for-hire drivers are not protected by traditional labor laws, such as Seattle's new $15/hr minimum wage law and its paid sick and safe ordinance.
"We’ve been waiting for this day, waiting to join the union and to have the right to negotiate with Uber."
Uber and Lyft drivers sought assistance from Teamsters Local 117 to improve working conditions in Seattle’s personal transportation industry. In 2014, drivers formed ABDA to promote fairness, justice, and transparency in the industry.
“Judge Lasnik’s ruling puts drivers one step closer to being able to freely exercise their right to have a voice and unionize under the new law,” said John Scearcy, Secretary-Treasurer of Teamsters Local 117. “We hope Uber will respect the judge’s decision, stop its efforts to block the law, and recognize that, just like millions of other workers across the country, for-hire drivers have a basic right to self-determination and to stand together with the representative of their choosing to improve their pay and working conditions. We will continue to help drivers fight for that right.”
Drivers will have to wait to exercise their rights under the new law until the court lifts an injunction and rules on a separate case.
Oxford Internet Institute has published “Towards a Fairer Gig Economy”, a collection of articles examining the social and economic problems associated with the “gig” economy. Entries are penned by academics, researchers and include an article written by our Local 117 Association Policy Coordinator, Dawn Gearhart.
"Unions cannot collectively bargain with an algorithm, they can’t appeal to a platform, and they can’t negotiate with an equation."
In “Giving Uber Drivers a Voice in the Gig Economy”, she examines the impact of automatized app platforms on drivers in a system designed to disempower workers. Technology that was welcomed for new opportunities brought with it stagnant problems: falling wages, long hours and poor working conditions. Organizing app-based drivers presents a new challenge for the unions, and yet Teamsters have led this fight.
“Unions cannot collectively bargain with an algorithm, they can’t appeal to a platform, and they can’t negotiate with an equation.”
Gearhart highlights successful efforts of the drivers to reverse adverse effects of the new technology by creating the ABDA association, mobilizing against cuts in pay rates and working to successfully pass legislation in Seattle that empowers drivers.
You can read more here.
Uber drivers at the company office in Tukwila on April 4. The group was there to protest unfair deactivation.
Judge Lasnik Emphasizes Order Should Not be Read as Harbinger of Final Decision
Seattle for-hire drivers who are seeking to unionize under the city’s new collective bargaining law are determined to continue their organizing efforts after a federal district court judge issued an order temporarily blocking the new law.
"This is just going to make us come together and fight more."
“It’s disappointing, but it’s not going to stop us,” said Musse Bahta, who has driven for Uber for four years. “There are so many drivers who are ready to stand up for their rights. We are standing together with our union. This is just going to make us come together and fight more.”
Another Uber driver, Peter Kuel, also vowed to continue the organizing efforts. “The judge needs to understand what we’re going through. It’s too much. We feel the pain doing this job. We are not going to give up. We will continue fighting for those who cannot speak themselves,” he said.
Don Creery, a union supporter who has been driving with Uber since 2014, said drivers are facing so many issues that the ruling would not prevent them from continuing to seek representation.
“There are so many problems. We’re not being paid adequately. That means you work longer hours, which means you’re not safe. We have no benefits – that’s an issue. I work full-time for a 70 billion company. The American taxpayers should not have to subsidize my health care. That’s not right.”
In his ruling, Judge Lasnik made it clear that the temporary injunction should not be interpreted as indicative of a final decision in the case:
“The Court emphasizes that this Order should not be read as a harbinger of what the ultimate decision in this case will be when all dispositive motions are fully briefed and considered. The plaintiffs have raised serious questions that deserve careful, rigorous judicial attention, not a fast-tracked rush to judgment based on a date that has no extrinsic importance.”
For more information, please contact Dawn Gearhart at 206-794-6678 or firstname.lastname@example.org.
When Uber drivers come together and speak out with one voice, good things happen.
Just two days after drivers packed a hearing room at City Hall to demand swift, fair implementation of the City’s new collective bargaining law, the company announced that it would raise its minimum fare from $4.00 to $4.80.
That means that drivers who get dispatched on short trips will see a modest increase in their earnings. As far as we know, Seattle is the only city where Uber is offering a higher minimum fare for drivers.
The reason for that is clear. Uber drivers in Seattle are getting more engaged in the political process. They’re letting the City, the company, and the public know that they want their rights under the new law to be respected.Read more
Check out our new video featuring Takele Gobena, a longtime driver for Uber and Lyft and a member of our App-Based Drivers Association.
In the video, Takele talks about the importance of having a Union, and how Seattle's new collective bargaining law helps gives drivers a voice. Our Union, Teamsters 117, played a pivotal role in helping to pass this groundbreaking legislation.
Please take a moment to watch the video and share it with your family and friends. Thank you!
If you want an excellent primer on our fight to organize and improve working conditions for Seattle-area for-hire drivers, look no further than this article that was published today in the American Prospect.
It's quite an extraordinary piece and call our Union - Teamsters 117 - the "spearhead of the battle" to create a more equitable city for all Seattle residents, not just the wealthy few.
It's long, but definitely a worthwhile read.