Topline
Uber filed a lawsuit against the New York City Taxi & Limousine Commission on Friday in an effort to block a round of rate increases, Bloomberg first reported, as the ride share giant’s battle against taxis continues.
Uber filed a lawsuit against New York City’s taxi commission on Friday, alleging its round of rate … [+]
Key Facts
Uber Technologies Inc. filed the suit in New York state court, according to Bloomberg, alleging rate increases approved last month would force the company to spend another $21 million to $23 million per month.
New York City’s regulatory commission on taxis and limos approved in November a rate hike that would increase the price of rides by 7.18% per minute and 16.11% per mile on Nov. 15, increasing the cost of a 30-minute Uber or Lyft trip covering 7.5 miles by $2.50 to $27.15, the New York Times reported (the cost of an average taxi ride will also increase by 23% under the plan).
High gas prices, which hit an all time record at just over $5 per gallon, on average, was one of the primary factors behind the rate hike, CNN reported—though the suit alleges the commission’s intention behind the fare hike was to create a “new methodology that locks in this summer’s high gas prices in perpetuity.”
According to Bloomberg, Uber argued in its suit the fare hike—the commission’s first in 10 years—would “irreparably damage Uber’s reputation, impair goodwill and risk permanent loss of business and customers.”
The city’s rate increase is set to go into effect on Dec. 19.
Key Background
The suit is the latest involving Uber since it disrupted the taxi industry over a decade ago. In 2019, a New York State Supreme Court judge in Manhattan dismissed a lawsuit from Uber challenging a city law that imposed a cap on the number of licenses ride-hailing companies could have. According to the suit, the law could give the city’s Taxi and Limousine Commission authority to make the cap permanent, giving taxi companies an advantage. Last year, Uber was sued by the Department of Justice for allegedly charging passengers with disabilities more for extra time needed to board a vehicle—Uber agreed to a $2 million settlement in July.
Tangent
Uber has also faced a string of legal challenges regarding Uber drivers’ status as independent contractors, rather than employees who are entitled to insurance benefits. In 2019, the National Labor Relations Board determined Uber drivers are contractors, a blow to drivers’ efforts to demand higher pay and benefits. In a separate lawsuit filed against the company earlier this year, however, Uber and Lyft drivers claimed the companies violated antitrust laws in withholding employee benefits from drivers by considering them independent contractors—a classification that Uber and Lyft have insisted on for years, arguing it allows drivers to set their own hours. In October, the Department of Labor proposed a new law that would classify gig workers as employees, setting the stage for ride-share drivers to receive rights of full employment.
Further Reading
Uber Sues New York’s Taxi Commission Over Rate Hikes for Drivers (Bloomberg)
Having Trouble Hailing Cabs While Uber/Lyft Prices Surge? Time To Fix Regulations (Forbes)
Source: https://www.forbes.com/sites/brianbushard/2022/12/09/uber-reportedly-sues-new-york-city-taxi-commission-to-block-fare-increase/