Rideshare drivers will not be getting a raise next week after all, as a judge sided with Uber in a lawsuit seeking to overturn the rate hikes approved by the Taxi & Limousine Commission last month.
Justice Arthur Engoron of the Manhattan Supreme Court issued a temporary restraining order Tuesday blocking 7% per-minute and 24% per-mile rate hikes from going into effect as planned on Dec. 19, after the rideshare giant sued the TLC claiming the agency had used flimsy, opaque calculation methods to support a big pay bump for drivers.
“Drivers do critical work and deserve to be paid fairly, but rates should be calculated in a way that is transparent, consistent, and predictable,” said Uber spokesperson Josh Gold in a statement. “Existing TLC rules continue to provide for an annual review tied to the rate of inflation; the for-hire vehicle industry is the only industry in New York State with this mandate.”
The rate hike for yellow cab drivers also approved last month is still set to go into effect next week as planned.
TLC Commissioner David Do said in a statement that he was disappointed but the agency will continue fighting the suit in court.
“We are disappointed for the tens of thousands of drivers who are once again being made to bear the rising costs of inflation all on their own, with no help from the multibillion-dollar company they work under,” said Do. “We will aggressively defend this important standard for our drivers.”
The parties are due back in court on Jan. 31.
In its suit, Uber contends the “dramatic, unprecedented, and unsupported hikes” approved by the TLC were based on inflation data that was cherry-picked and not representative of long-term economic forecasts. They specifically highlighted the rise in gas prices, which skyrocketed earlier this year but have since returned to more stable levels, but are one of the marquee reasons justifying the fare hike.
The company claims the hike would force it either to spend at least $20 million per month on compensation or raise prices for passengers by 10% — which it deems unacceptable, given it has already upped fares by a whopping 48% since 2019. Uber says the hike would damage its reputation and cause it to lose customers to yellow cabs and mass transit.
Driver unions lambasted the decision, comparing Uber to some of the holiday season’s most notorious villains.
“This is a nasty stunt for Uber to pull on its drivers— especially right before the holidays. Even this would make Scrooge blush,” said Independent Drivers Guild president Brendan Sexton. “While Uber has been recording record profits on its rideshare business, the drivers who make the service work have been stuck shouldering soaring expenses on their own. We fought hard to win this desperately needed increase to the minimum pay — and we will not let a billion-dollar corporation snatch that victory from the 80,000 rideshare drivers who keep our city moving.”
The New York Taxi Workers Alliance, which represents 21,000 cabbies and rideshare drivers, went instead with the Grinch, arguing Uber is attempting to steal Christmas from its workers.
“This decision is financially devastating for thousands of drivers and our families. And it comes at a time of families and joy and promises and miracles, at times when drivers most need the financial security to take time off with their loved ones, and buy holiday gifts instead of gas,” said NYTWA executive director Bhairavi Desai.
“To steal a raise from drivers who work so hard and on the eve of Christmas and the new year hurts. It stings,” Desai continued. “But make no mistake, we’re not crying in a corner. We’re readying to fight the small-hearted pettiness of a billionaire company that just doesn’t want to see its workers survive. We intend to use everything in our arsenal to protect every last dollar that is owed to drivers. This fight is far from over.”
