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An Uber taxi is driven away from New Street Railway Station in Birmingham
Image: An Uber taxi is driven away from New Street Railway Station in Birmingham. REUTERS/Darren Staples

Many Uber, Lyft Drivers Rely On App Firms For Income

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Image: An Uber taxi is driven away from New Street Railway Station in Birmingham. REUTERS/Darren Staples

A sizable portion of Uber and Lyft drivers rely on the ride-sharing apps as their primary source of income – contradicting the commonly held belief that their work is part-time or supplemental.

The two companies are among the best-known of the so-called “gig economy” of freelance workers with no fixed hours, who work as little or as much as they wish, typically via smartphone apps. But a new survey from the University of California, Los Angeles (UCLA) suggests that driving-for-hire is a full-time occupation for many.

About half of Uber and Lyft drivers surveyed by UCLA said such work was their only job. Two-thirds said it was their main source of income. Nearly half were working more than 35 hours a week, and more than half were working for at least five days each week – suggesting the work is full-time. In addition, the average driver had been driving-for-hire for more than a year.

Big Implications for Gig Economy

The research may have implications for gig economy firms, which have come under pressure from regulators and courts over their treatment of workers, including food-delivery app Deliveroo.

The rise of Uber, Lyft and other ride-sharing firms like Sidecar have revolutionised transport for many consumers, offering them a relatively inexpensive way to travel on-demand. But the companies have fuelled a growing debate about the impact of such work on drivers, transport networks and other travel businesses.

The drivers’ concerns centre on the fact that, as freelance contractors, they are not entitled to perks associated with full-time work, including sick pay and maternity leave. For gig economy workers such as Uber and Lyft, their business models rely upon the “independent contractor” definition of worker.

But recent court cases have considered workers’ rights in the gig economy, with Uber fighting to overturn an earlier court decision in which two drivers successfully claimed they were not self-employed, but full-time workers entitled to the minimum wage.

Regulatory Pressure

This week, San Francisco’s city attorney subpoenaed Uber and Lyft for employment data after the California Supreme Court ruled that gig economy companies must narrow their definition of “independent contractors” and apply wage orders to workers who should be classified as employees.

The UCLA research found that costs like vehicle upkeep placed financial burden on drivers, with nearly half saying they struggle to pay for expenses such as insurance and gas. Some are taking on debt or extra work to cover such costs.

‘Destroying Full-Time Work’

“Policymakers in California and around the country really need to pay attention to the idea that what we’re doing here is destroying full-time work in the context of creating some part-time work,” said Biju Mathew of the National Taxi Workers Alliance this week during a conference call organised by UCLA.

Lyft said in a statement that the majority of its drivers sign up “to supplement their income and as a flexible earning opportunity”, appearing to contract the UCLA research. “In Los Angeles specifically, 93% drive fewer than 20 hours per week and 99% schedule driving around jobs, classes, childcare, and other activities,” a spokesperson said.

UCLA’s report found that the majority of drivers it surveyed were split on whether they wanted to become full-time employers or remain independent contractors. But it advocated strongly for more regulation on ride-sharing app companies and expanded benefits for their drivers.

“Our findings show that gig workers in Los Angeles value flexibility, but also require a measure of predictability, safety, and income security – protections long available to their counterparts in traditional wage-earning work”, the report said.

Note: The opinions expressed in this article are the author's own and do not necessarily reflect the view of Alvexo on the matter.