By classifying themselves as technology companies, ridesharing services like Uber and Lyft are able to profit off a lack of regulatory compliance and sub-standard wages, all while undermining traditional transportation options. TTD Secretary-Treasurer Greg Regan recently shed light on the ridesharing industry’s exploitative business practices, and called on Congress to hold companies like Uber and Lyft to the same safety, accessibility, and labor standards as other transportation services. Check out this exchange with Rep. Donald Payne (D-NJ) and don’t miss Greg’s full testimony to Congress. A transcript is below.
On behalf of the Transportation Trades Department, AFL-CIO (TTD), and our 33 affiliated unions, I want to thank Chairwoman Norton and Ranking Member Davis for inviting me to participate in today’s Roundtable.
The discussion today is about public transportation policy, and the potential role private “Mobility on Demand” operators can or should play in the future delivery of these services.
At TTD, we believe public transportation is, and always has been a promise made by government to the American people. A promise that we all can depend on public transit to connect us to work… to school… to doctor’s appointments… and to our families… A promise that the services provided will be safe… affordable… accessible to all… and reliable… And a promise that those who work in this sector earn fair, livable wages.
When considering any policy proposal, or new service provider, I will judge them on whether they help fulfill this promise.
I am not here to simply advocate for the status quo. TTD supports innovative improvements to our transportation landscape that give more people better access to these services. Labor unions are proud advocates for innovative policies and technologies that aid transit operators and enhance safety… and we support workforce training and development programs that prepare our members for twenty-first century transportation jobs.
We welcome the opportunity to work with any partner who is advocating for better and more public transportation services. We also recognize the opportunity that mobility-on-demand services may offer… but we expect partners in innovation to subscribe to the promise of public transportation.
Sadly, the business model being pursued by ride-sharing companies like Uber and Lyft, runs counter to the benefits public transportation provides to communities across this country. These companies gouge their workers, set their own safety standards, and are not always accessible by those who rely on transit the most… And that’s by design.
By taking advantage of the current regulatory framework, these companies seek to line the pockets of investors at the expense of the communities in which they operate. Consider these facts:
The mean wage for urban transit drivers is $20 dollars/hour. In some cities wages are as high as $40 dollars/hour, and these jobs generally come with good benefits and retirement packages that come with a union contract.
By contrast, Uber and Lyft lured drivers with the promise of high earnings, but slashed them to the bone. Now, these companies are coming for public money because they need a pathway to profitability.
A recent study found that Uber drivers net take-home pay is around $9 dollars/hour, with no benefits. That is less than what 90 percent of American workers earn and below the mandatory minimum wage in the majority of Uber’s urban markets. As a result, many ride-share drivers are forced to hold two and three additional jobs, often working for more than one ride-sharing company just to make ends meet. This kind of economic insecurity leads to tired, overworked drivers on our roads – a significant safety risk – and contributes to the wealth gap we see in our country today.
While traditional public transportation is subject to a wide array of regulatory, labor and safety requirements, companies like Uber and Lyft skate by under a patchwork of state and local regulations that allow these companies to evade requirements like accessibility, vehicular safety, and data sharing.
- There is no universal standard for ride-share drug testing or background checks.
- Not every state requires non-discrimination policies, and even fewer require companies like Uber and Lyft to provide wheelchair accessible vehicles for their customers.
- Ride-share companies are notorious for fighting state and local data sharing requirements at every turn.
- And efforts to afford these drivers the right to collectively bargain have been aggressively opposed by these companies at all levels of government.
Despite their anti-worker, minimal-safety, and selective-accessibility business models, we have seen a rush by transit agencies to form partnerships with Uber and Lyft. Since 2016, more than 30 of these partnerships have been formed.
While we understand why transit agencies are partnering with ride-share companies, we ask you to consider the broader impact they are having on our communities:
- At their current rate, companies like Uber and Lyft stand to cause a 13 percent decline bus ridership over the next 8 years.
- Already, these companies have added 5.7 billion miles of new vehicle traffic in 9 of our largest cities, with another 5.5 billion miles expected each subsequent year.
- And because most of these rides are single occupancy, they are moving many riders out of shared spaces and into cars – further contributing to the congestion and environmental problems public transportation is meant to solve.
If companies like Uber and Lyft are to ever receive federal incentives, Congress must take the lead in providing thoughtful and real oversight of the ride-share industry. After all, it is not the duty of our nation’s transit agencies to prop up failing private businesses.
While the opportunities presented by new technology are exciting, we must consider whether this technology is actually advancing the goals that policy makers aim to achieve… Goals like the creation of living wages… increased safety… reduced congestion… improved accessibility… and the creation of environmentally sustainable transit options. Companies who peddle software that accomplishes none of these should not rewarded for bad behavior or applauded for undermining our existing system.
With that, I thank the committee once again for inviting me to this panel today, and look forward to answering your questions.