Drivers fight back, a push for unions and a broken business model. LegalRideshare breaks it down.
After Uber blocked a recent pay raise, NYC drivers went to the streets in protest. ABC7 reported:
The protest comes after Uber successfully took legal action to block a scheduled pay raise and fare hike for Uber drivers in the city.
Around 100 drivers headed over the Brooklyn Bridge Monday morning into lower Manhattan demanding action be taken by the company.
A federal judge has temporarily halted a planned 11% pay increase after Uber objected to the raise and fare hikes proposed by the Taxi and Limousine Commission.
Jose Taveras immigrated here from the Dominican Republic. He's been a fulltime driver for 7 years.
This is how I feed my kids,” Taveras said. “This is how my pay my bills and this is how I accomplish my dreams. We want Uber to be successful, a successful company, but we also want Uber to be fair. Play fair.”
Instacart founder is getting sued. Bloomberg reported:
Instacart Inc. cofounder Apoorva Mehta was accused in a lawsuit of using stolen trade secrets to create a healthcare startup that was a copy of an existing company.
Hello Logistics Inc., which operates under the name NextMed, sued Mehta, his business partner Tejasvi Singh, and their company Cloud Health Systems over allegations of misappropriation of trade secrets, copyright infringement and other claims. Both companies run websites promoting weight loss.
Singh, a cofounder of NextMed, collected some of the company's closest held trade secrets under the guise of gathering the information as part of due dilligence for investors, according to the complaint.
Mehta and Singh then used the information to create a company that does business as Sunrise, with a copycat website, according to the complaint. They also lined up vendors and implemented NextMed's highly confidential customer acquisition and other strategies, “in mere weeks,” NextMed claimed in the complaint.
Gig workers in Boston revived a push for union rights. WBUR reported:
After an election cycle where ride-hailing and food delivery drivers' rights were originally planned to be on the ballot, drivers for apps such as Uber, Lyft, Doordash and Instacart joined with labor advocate allies to attempt to reinvigorate calls for a union ahead of the new legislative session set to start in two weeks.
Drivers for Uber and Lyft say the percentage of the cost of the trip that ride companies collect from each ride has doubled, or even tripled, in the last few years, taking profits away from drivers.
Another point driving calls for a union is that the app-based companies can terminate a driver's account at any time without cause, advocates said.
Though the question of drivers' employment classification has been an ongoing issue in Massachusetts. A planned ballot question would have codified the workers classification as “independent contractors” this year and there's ongoing litigation from the attorney general's office to make drivers “employees.” Advocates on Wednesday said the question of a union is separate from conversations around gig workers' status.
One Lyft driver exposes how the Lyft business model is broken. Slate reported:
After I dropped her off, the Lyft app revealed my portion of the base fare: $16.52. My passenger added a generous $8.96 tip, for total earnings of $25.48. That made it my most lucrative trip that week. But Lyft raked in much more: $42.48.
After that Saturday night trip, I started asking my passengers how much they'd paid and comparing it to what I'd earned. The results were all over the map. I had two trips where I got more than 80 percent of the total fare, including tips. I had a couple of others where I earned less than 30 percent.
I wrapped up my Lyft driving experiment after a week, having completed 100 rides in 46 hours and earning $1,111. Lyft eventually sent me a report showing that passengers had paid a total of $2,139.73 for these rides, so on average I got just 52 percent of what my passengers paid.
Ever since then, I've been trying to figure out how Lyft could take such a big cut of passenger revenue and still fail to turn a profit — Lyft says that it lost almost a billion dollars in the first nine months of 2022. The more I've looked into it, the more I became convinced that it's going to take major cost-cutting for Lyft to avoid eventual bankruptcy. I was also left asking one question: If after all these years, Lyft and its competitor Uber's disruption of the old taxi model still doesn't make business sense, what was the point?
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