City Council member wants pay hike for Uber, Lyft drivers

Ald. Roderick Sawyer’s proposed ordinance would stop ride-hailing firms from making “record profits” while drivers barely make ends meet. “They need a decent increase. They feel like they’re getting shafted,” Sawyer said.

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Uber and Lyft are two ride-hailing companies that operate in Chicago.

A proposed city ordinance would increase pay for drivers who work for ride-hailing services, including Uber and Lyft.

Associated Press

Uber and Lyft drivers could be in for a big pay hike — at riders’ expense — if the City Council’s former Black Caucus chairman has his way.

Ald. Roderick Sawyer (6th), who still chairs the Council’s Committee on Health and Human Relations, is proposing a sweeping ordinance to stop ride-hailing companies from making “record profits” while drivers barely make ends meet.

“They need a decent increase. They feel like they’re getting shafted. They say the pay is much too low and they’re not getting the percentage of the surge pricing they feel they’re entitled to,” Sawyer said.

Sawyer acknowledged consumers already squeezed by inflation will pay the price for putting more money in the drivers’ pockets.

But “even with these changes, Uber and Lyft prices would still be affordable if we can rein in the surge pricing [to] 150% of the regular price. We want to cap it at that. They have surge prices that go three and four times the normal ride rate. I know that because I’ve [paid] that.”

The ordinance Sawyer plans to introduce at Wednesday’s City Council meeting would require that drivers get paid at least $5 per trip, regardless of any other pricing guidelines in effect. The ordinance outlines those guidelines and other changes, too. Among them:

• The initial per-minute rate would be 30 cents, with automatic annual increases tied to the consumer price index, beginning July 1.

• Companies would have to pay drivers at least the equivalent of the base rate of $2 multiplied by the per-mile rate. The initial-per mile rate would be $1.20 with annual increases tied to the cost of living.

• Uber, Lyft and other “transportation network providers” would be prohibited from remitting to their drivers “any less than 80 percent of compensation for service charged to the customer.”

• Companies could not retain “any portion of any incentive or gratuity earned or fee paid by a passenger for cancelling an accepted ride” or “any portion of any incentive or gratuity earned or free paid by a passenger for canceling an accepted ride.”

• Transportation network providers couldn’t raise their regular fare rates on file with the city “more than once a month.” Surge pricing based on the demand for services and availability of drivers would still be allowed.

• Passengers would be required to verify their identity on the Uber and Lyft app.

• A “Public Chauffeur Assistance Fund” would be established for the “sole purpose of promoting the safety … of licensees.” Funds would be generated by a new tax of $1-per-month-per-taxicab, plus one cent per trip.

The money would be used to provide assistance with maintenance payments including contracting for one or more locations throughout the city where transportation network vehicles and taxicabs may receive city-subsidized routine maintenance and minor reports.

Drivers could also receive “direct grants of safety equipment, such as protective barriers and dash cams” procured by the Department of Business Affairs and Consumer Protection or through cash grants, the ordinance states.

• Uber and Lyft would transmit electronic receipts to drivers within 24 hours of each trip. The receipt must include an itemization of the total fare paid by the passenger, including tip compensation and gross payment.

Drivers deprived of the minimum compensation “may recover in a civil action three times the amount of any underpayment,” the ordinance states.

• A system for adjudicating appeals of driver suspensions would be established.

Sawyer proposed the appeals process in response to a driver who claimed he was slapped with an automatic suspension after being falsely accused by a passenger of driving drunk.

“He said he’s never had alcohol in his adult life,” Sawyer said.

“The rider was just mad because he didn’t get to where he wanted to go fast enough. And without even asking [the driver], they just pulled him off the app.”

A spokesman for the Illinois Coalition for Independent Work, which represents the companies, issued a statement in response to the proposal:

“As it stands, this ordinance could unfairly penalize drivers and riders. We look forward to working with the alderman and the city council to protect pay and strengthen benefits workers deserve while balancing the flexibility they need.”

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