Uber Technologies Inc. has started to prevent some of its drivers in New York City from using its app during times when there are not many people needing rides. This action is in response to a rule in New York that has been in place for six years, which says companies like Uber and Lyft must pay their drivers even when they are waiting for their next ride, not just when they are driving a passenger. Similarly, Lyft Inc. has indicated that it might also begin to lock out drivers during such slow periods. As a result of these lockouts, some drivers report that their earnings have halved.

Unpredictable Lockouts Disrupt Uber Drivers’ Lives and Livelihoods

These lockouts happen without any set schedule, which makes it tough for drivers to plan their working hours and rely on Uber as a steady job. In some cases, drivers find themselves unable to access the app for more than an hour at a time.

An Uber spokesperson explained that the number of riders seeking trips at any particular moment and place is directly tied to the app’s access. When there are too many drivers and not enough riders, Uber temporarily restricts access for some drivers.

For Nikoloz Tsulukidze, a full-time Uber driver, these lockouts have become a frequent disruption. He shared that there were days when he would be locked out four or five times, severely impacting his income. “I used to work 10 hours and make $300 to $350,” Tsulukidze said. “Now, I just worked 10 hours and barely made $170. I was so disappointed. I’m paying for my gas and cannot make money.”

Wesly Dorsainvil, another driver who works full-time with Uber, echoed similar sentiments. He noted a significant drop in his earnings, from between $300 and $400 per shift to now sometimes only making between $170 and just over $200.

Tension Rises as Uber and Lyft Blame Each Other and NYC Regulations for Driver Lockouts

Bhairavi Desai, president of the New York Taxi Workers Alliance, criticized Uber, suggesting that the company created an oversupply of drivers and is now unfairly penalizing them. She pointed out that Uber stopped accepting new drivers in April 2023, primarily because of the New York City Taxi and Limousine Commission’s (TLC) pay rule, pushing new applicants to a waitlist.

In communications with drivers, Uber and Lyft have both placed blame on each other and on the TLC for these lockouts. Uber claims it must raise pay when Lyft drivers are less busy, as the TLC’s formula for minimum pay includes an industry-wide average of non-passenger time.

Uber and Lyft Clash Over NYC Regulations Impacting Driver Earnings and Access

Uber’s spokesperson, Freddi Goldstein, expressed frustration, stating, “The city’s rule bizarrely holds Uber responsible for Lyft’s failures.” With Lyft struggling to keep its drivers busy, Uber feels it has no choice but to limit driver access to balance the pay requirements.

TLC data indicates that Uber’s drivers have been busier than those of Lyft this year. However, Uber’s large market share in New York means it significantly influences the average figures used in these calculations.

Recently, Uber encouraged its New York City drivers to voice their concerns to the TLC about how these regulations have affected their earnings. Some, including Desai, view this move as Uber manipulating the situation to avoid paying drivers for times that legally require compensation.

Lyft Warns of Potential Lockouts as Dispute Over NYC Pay Rules Intensifies

Lyft has responded by informing its drivers that Uber is pushing for changes in the rules that would disadvantage Lyft. The company announced that it might also need to start freezing driver access soon.

Lyft’s spokesperson, CJ Macklin, criticized the current pay formula, claiming it restricts when and how much drivers can earn and unfairly benefits Uber. He added that Lyft is pushing for changes in the TLC rules to create fairer competition and ensure just payment for drivers.

Desai warned that the union might consider a strike if the lockouts do not stop. She highlighted that the ride-hailing companies have often clashed over TLC regulations, and past disputes have led to similar actions. In 2019, both Uber and Lyft temporarily locked out drivers after New York City tried to set a flat minimum pay rate. The onset of the COVID-19 pandemic in early 2020 paused this dispute. Moreover, Uber and Lyft have also resisted regulations in other U.S. cities, such as threatening to leave Minneapolis over a proposed pay raise and temporarily exiting Austin when the city wanted to introduce driver fingerprinting rules in 2016.