[wlesieutre]

News flash: if you go out of your way to classify your entire workforce as contractors, you don't get to decide when they work or not. It turns out this has consequences on both sides.

If Lyft wants to decide when their drivers are working, there's a process for this:

1) Hire employees

2) Give them a schedule

3) Pay them hourly plus mileage

[chrismeller]

I find it hard to agree. Hear me out...

They are contractors because they do not have any set obligation for time. Rate of pay or overall pay has nothing at all to do with that. According to the IRS they do not have a set schedule and they are contractors (that is 1099, not W2).

So they are contractors. What does that have to do with pay? Absolutely nothing. You want x and are willing to pay y. Maybe there’s an opportunity for me to negotiate for z, maybe not. Either way none of that has anything to do with the actual form of employment. Even if I were a salaried employee working 40 hours a week the company has a budget of $40,000 a year and that’s all they will pay. If I demand $45,000 they’ll just tell me no - they simply don’t have the money.

In this case Uber offered you $x. You agreed to $x. You have no schedule, which is the perk of the job vs driving a cab, where you will have a schedule. Need to take the kids to school or a doctor’s appointment? Well, work that around your work schedule.

And as for your third point... Uber already charges me for both time and mileage. I don’t see any problem with them paying their drivers based on both... but from the drivers I’ve talked to they already do. I can’t speak for any other service at all.

[jakelazaroff]

> In this case Uber offered you $x. You agreed to $x.

When did they agree on $X? There's no contract between the drivers and Uber stating they they will work for a given amount.

The app sets rates based on supply and demand. Uber offers them $X. The drivers decide they don't want to work for less than $Y. If demand is sufficient, Uber eventually offers them $Y.

Surge pricing is basically a negotiation between company and driver. Just because the drivers have found a case in which they have extra leverage doesn't make it wrong or fraudulent.

[ummonk]

Cartels colluding together to artificially reduce supply in a market is often considered illegal market manipulation. That lyft is acting as a middle-man to set market-clearing prices here doesn't change that.

[jakelazaroff]

This was brought up elsewhere in the thread, and it's a valid concern. But consider that this might instead be a strike. Drivers want to be paid $Y, so they refuse to work until Lyft agrees.

I'm not sure where the line is between the two. But given that the market in question is the drivers' labor — and the ongoing question of whether the drivers are employees or contractors of these multi-billion dollar companies — I'm inclined to consider this "labor organizing" rather than "price fixing".

[ummonk]

Yeah, and I'm not sure what's described in the article need even be considered "labor organizing". It seems to be just drivers exercising their power to not drive if the market rates aren't high enough. It seems like the weird signing off from the app actions wouldn't be needed if Lyft had better provisions for drivers to enter the rates that they're willing to provide rides at.

[human20190310]

> In this case Uber offered you $x. You agreed to $x.

The value of x was established under different circumstances. What's wrong with bumping that to 1.5x as soon as you have the power to do so?

When the cab industry was "the system", Uber and Lyft beat the system and made money. Now the drivers are beating the Uber/Lyft system and making money.

Viva disruption.

EDIT: Actually Uber/Lyft beat the cab system and lost money, but that's another kettle of fish.

[richardknop]

> In this case Uber offered you $x. You agreed to $x.

This is not true. Uber and drivers did not sign any contract specifying set rate.

Every ride that is offered to drivers has price based on supply/demand. Drivers are free to cancel jobs if they feel the offered rate is too low.

[chrismeller]

So the driver agreed to a certain amount and was paid a certain amount? Seems like I’ve heard that somewhere...

I never said they agreed to an hourly rate, I said they agreed to a rate, and they did.

[ric2b]

They agreed to rates for previous rides and gave those rides. Each ride is has independent rates, there's no reason they have to accept past rates for future rides.

[wlesieutre]

>They are contractors because they do not have any set obligation for time. Rate of pay or overall pay has nothing at all to do with that. According to the IRS they do not have a set schedule and they are contractors (that is 1099, not W2).

I'm not saying they're not contractors, I'm saying if Uber wants drivers who will work at a specific constant rate instead of signing out and demanding surge rates before they'll sign back in, then that's too bad for Uber. They created a market for driver contractors, and the drivers are participating in it. If they want shift employees who are obligated to stay logged in when a plane lands, they can hire some.

>In this case Uber offered you $x. You agreed to $x. You have no schedule, which is the perk of the job vs driving a cab, where you will have a schedule.

It's working exactly as intended then, Uber offers $x, drivers say "I'm not interested in driving for $x." Uber automatically counters with "Fine, I'll pay you $y."

Uber could make their system more hesitant to offering surge pricing after a bunch of drivers sign out like this, but when it comes down to it this isn't even a strike. The drivers haven't agreed to take fares at the lower rate, and Uber isn't entitled to their labor at any particular cost. They can all go home if they want to.

>And as for your third point... Uber already charges me for both time and mileage. I don’t see any problem with them paying their drivers based on both... but from the drivers I’ve talked to they already do. I can’t speak for any other service at all.

My point is that if Uber wants drivers a fixed particular price than then their "everyone is contractors" solution isn't appropriate. They can hire employees on an hourly wage to take shifts where they're paid whether or not they're currently driving a fare (mileage on top of that is to cover vehicle expenses). Sometimes they'll be busy, other times they'll have a slow night.

They don't get to have their cheap no strings attached driver arrangement cake and then also whine when drivers sign off and prices spike.

[thrill]

You have not agreed to 'x' until you accept the ride - and either the driver or the rider can cancel the engagement without penalty for a few minutes after the acceptance.

[thatoneuser]

Plenty of contractors have set hours and come into an office. Several friends in software contracting firms for example do that. Also uber doesn't agree to pay you a damn thing. You could literally go work for 4 hours and make <$10.

[lexs]

And suddenly Uber/Lyft are like any other Taxi company just with a massive valuation.

[wlesieutre]

There's probably a balance to be struck, because part of the ridesharing design's efficiency is that if demand drops they can drop their rates paid to drivers, and the drivers who don't want to drive at those prices will stop.

So if Lyft starts to say "we always want X drivers available as a base load, and we'll open up to contractors to fill in the demand spikes" it might make the contractor role too unreliable for anyone to bother doing it. At the very least, their costs would go up for both the employed drivers and the extra contractor drivers. Since their valuations comes mainly from a cheap labor pool, that presumably kills it.

But in the current situation, if all their drivers at the airport sign off and say "I'm not driving at these prices," you get surge pricing to make it worth driving, that increases costs too. That's what happens when you're buying labor from independent contractors - if they don't want to sell it to you at a particular time for any reason, they don't have to.

The real question here is "If Lyft recognizes when these organized sign-offs are happening, calls their bluff, and refuses to activate surge pricing, what happens?"

Do the drivers really refuse to drive at the regular pricing and go home? Or do they all give in to a more tamper-resistant algorithm and keep driving at regular rates?

[lr]

Can we please stop referring to these services as "sharing"? Lyft actually started as a company that coordinated the sharing of rides, i.e., no money was involved. But the "sharing" pretense has long since past for all of these companies.

[thebluehawk]

Right? It's nonsense. A grocery store isn't "food sharing", and a barber isn't "hair cut sharing". It's one party paying another for a product/service. Uber/Lyft's killer feature is the app pairing those two parties. But no one is "sharing".

[papln]

google.com/search?q=buy+a+share+of+a+cow

[egypturnash]

We need a new word for "taxi companies with cute apps, unsustainable pricing/wages and lots of Silicon Valley venture capital propping them up" to distinguish them from old-school taxi companies if we're gonna quit saying "rideshare".

Any suggestions?

[jhbadger]

The dot-cab bubble?

[toast0]

I prefer unlicensed taxis.

[crooked-v]

While this is accurate, I think the subtext of it conflicts with the common anecdotal claims (including mine) far preferring Uber over actual licensed taxis.

[lr]

"hired car" // been in use for decades

"ride for hire"

"car for hire"

"fee for service"

[Marazan]

Macro-cab firms.

[blt]

gig cabs

[papln]

You know what it's caled when a bunch of people put up capital or labor in exchange for a portion of the retrun from coordinated activity. It's called buying a share -- from adventurers to publicly traded corporations.

Lyft isn't ride sharing because people aren't dividing up cars to rides, not because money is involved. Car2Go/Flexcar are car sharing. Carpooling is ride-sharing.

[ErikVandeWater]

> Or do they all give in to a more tamper-resistant algorithm and keep driving at regular rates?

I wonder if they will change the algorithm to just tell the drivers what they want to hear. To wit - Introduce a new multiplier for drivers based on their behavior. This will factor into the final price, but be obfuscated. Then Lyft can tell the drivers they are receiving a greater surge than what the rider sees, and pays.

[jimbokun]

I think the drivers need to use the passenger app to see the surge pricing, anyways?

[seanmcdirmid]

> And suddenly Uber/Lyft are like any other Taxi company just with a massive valuation.

What taxi companies have drivers as actual employees and not independent contractors?

[UncleEntity]

Almost all of them. You lease a car and anything over lease and gas you get to keep.

--edit--

Never mind, read that backwards...

[uxp100]

I think they'd retain some of that valuation. Unlike traditional cabs, they show up (I've been stranded by more cabs called by phone then I've taken, not hyperbole). But the value of some unified dispatcher framework, with penalties for abandoning customers probably isn't in the tens of billions. Maybe in the hundreds of millions? Either self driving cars change everything, quite quickly, or some people are going to lose a lot of money.

[toss1]

"And suddenly Uber/Lyft are like any other Taxi company just with a massive valuation." . . . which valuation would be rapidly evaporating.

I suspect this will happen one way or the other, as something that cannot be sustained will not be -- something's got to give, either rates will go up, costs will go down, or the companies will fold.

Rates probably have some room to rise. My limited experience is mostly airport rides, where they are cheaper than limo's taxis. But I'd still pay the same as the competing services, since Lyft has always been more reliable and pleasant. The main competition is parking.

Lower costs? I don't think so, short of automation. The drivers' costs & compensation have already evidently been pushed to the limit, as they are starting to strike.

Will they sort out either? I'm not buying either stock, even at the discount prices...

[joering2]

Not quite. Real taxi corporations have approval of city/state assembly to do business so that they control the amount of taxi cars being part of daily street flow. (Im ignoring the fact that this system is broken and corrupted)

[metalliqaz]

If their workforce suddenly switched from contractor to employee, I expect that valuation would evaporate.

[megy]

> any other Taxi company

Except world wide (or us wide).

[neaanopri]

Well, not for long...

[madeofpalk]

Exactly.