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New York Passes Landmark Ride-Hail Service Regulation

New York Passes Landmark Ride-Hail Service Regulation

NYC is the biggest US market by far for ride-hail service apps such as Uber and Lyft.

New York has become the first major US city to approve a cap on ride-hail car licences and set minimum pay conditions for drivers.

NYC becomes the first American city to restrict the explosive growth in ride-sharing cars in major defeat for Uber and Lyft.

A study last month estimated that app-based drivers now complete over 17 million trips a month in the city.

Yet yellow cab drivers and anti-congestion campaigners have long pushed for regulation after the number of app-based cars has soared. About 80,000 now operate in the city, versus just 13,500 yellow cabs.

A controversial new bill passed by the New York City Council on Wednesday approves a year-long moratorium on new ride-hail vehicle licences for 12 months, with the exception of wheelchair accessible cars.

Taxi drivers demonstrated in support of the bill outside the headquarters of the New York City Taxi and Limousine Commission (TLC) this week, while the likes of Uber and Lyft have naturally spoken out against it, claiming it will hurt consumers.

The bill also gives the TLC the power to regulate minimum rates of fares, minimum pay for drivers, and create a new rulebook for app companies.

The study mentioned above, which was commissioned by the TLC, recommended a minimum hourly wage for drivers of $17.22 per hour – and found that 85% of app-based drivers currently net below that amount.

A strong victory for an even stronger union

The legislation was supported by New York Mayor Bill de Blasio, who said it would help “stop the influx of cars” causing congestion in the city.

Uber, however, said in a statement Wednesday: “The city’s 12-month pause on new vehicle licenses will threaten one of the few reliable transportation options while doing nothing to fix the subways or ease congestion.”

Lyft said the move would “bring New Yorkers back to an era of struggling to get a ride, particularly for communities of color and in the outer boroughs.”

The New York Taxi Workers Alliance celebrated the vote, describing it on its website as a historic victory for its 18,000-member strong union.

New York City is the first major US market to place a cap on Uber and similar services, which could inspire other cities to adopt legislation as they grapple with the effects of ride-hailing services.

In Europe, transportation authorities in London cracked down on Uber’s services last year, withdrawing its license to operate in the city, which is Uber’s largest European market, according to The New York Times. The company eventually won an appeal on the decision in June after it agreed to open itself up to stricter regulation.