NYC Proposes 5% Rideshare Driver Pay Raise Amid Uber, Lyft Pushback

New York City's Taxi and Limousine Commission (TLC) has finalized new minimum-pay rules for rideshare drivers, instituting a 5% wage increase following pushback from Uber and Lyft, down from an initially proposed 6.1% raise. The rules aim to prevent companies from locking drivers out of their apps—a tactic both Uber and Lyft used starting in May 2024 to manage costs by restricting driver access during low demand periods, which caused financial stress for drivers. Unlike many other regulations, New York’s pay structure compensates drivers not only for time spent with passengers but also for the time spent traveling to pickups and waiting for dispatches. Despite the pay raise and commitments to warn drivers before lockouts, Lyft expressed concerns that the underlying pay formula may still reduce driver earnings, increase rider costs, and limit ride availability. The TLC board is set to vote on the new rules on June 25, and the regulatory changes have had a mixed impact on Uber’s stock, reflecting investor uncertainty about the company’s future earnings under the new pay regime. These developments mark a continued contentious relationship between rideshare companies and regulators over driver protections and compensation models in a shifting gig economy landscape.