New York Judge Blocks Pay Raise for Uber, Lyft Drivers

By A Correspondent
NYC cab and limousine drivers staging a protest inn New York City. (Photo by Adrian Childress, CC license)

A New York State judge on Friday blocked regulators from raising the pay of ride-hail drivers, saying that the Taxi and Limousine Commission had not sufficiently justified the fair increase.

Uber sued the New York Taxi and Limousine Commission last month and argued that the increase, approved in November, was too high and could require the company to spend an additional $21 million to $23 million per month to pay its drivers. Uber argued that to avoid taking on the extra costs, it would have to raise fares by 10 percent, which could drive business away.

Justice Arthur F. Engoron of the State Supreme Court in Manhattan agreed with Uber’s argument on Friday that the commission had used a faulty methodology to calculate the pay increase, including factors such as last summer’s sharp increase in gas prices, which has since abated.

A written ruling is expected to come next week. The New York Taxi Workers Alliance (NYTWA) called the ruling “misguided” which came on the heels of a second 24-hour strike and protest by Uber drivers who are demanding an immediate reinstatement of the raise.

“We call on the Taxi and Limousine Commission to immediately redo the rules so drivers do not have to wait one day longer for their raise,” said NYTWA Executive Director Bhairavi Desai in a statement. She said a few “missing words in a Statement of Basis and Purpose” did not justify denying a raise meant to help thousands of drivers pay their rent and put food on the table for their families.

“Shame on Uber for spending millions on this heartless lawsuit only to deny drivers an increase of $1.66 more on an average trip. Uber woke a sleeping giant. This raise belongs to the drivers and we will not rest until it’s back in our hands,” she added

NYTWA estimates that New Year’s Day, NYC app drivers had already lost approximately $12 million in income from Uber blocking their raise. On December 23d, the New York Taxi Workers Alliance (NYTWA) filed an Amicus Brief in the state court case for the Judge to consider the drivers’ interests in restoring the raise.

In court filings, Uber said it is charging UberX passengers 48% more in September 2022 compared to 2019. The TLC voted on the raise to help drivers cover costs from record inflation. For drivers and for all Americans, bread and milk are the most expensive they have been in last 40 years.

Meanwhile, for drivers, car expenses have gone up even more. In the New York City region, car-related costs are up 250%. Gasoline doubled this summer compared to 2018, the year the Uber and Lyft driver rates were first established by TLC.

The New York Times quoted a representative for Uber praising the judge’s decision and said the commission’s proposed pay hike had been “arbitrary and based on temporary market shocks”.

“Rates should be calculated in a way that is transparent, consistent, and predictable,” NYT quoted Uber representative, Josh Gold, as saying. “Existing T.L.C. rules continue to provide for an annual review tied to the rate of inflation.”

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