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News flash: if you go out of your way to classify your entire workforce as contractors, you don't get to decide when they work or not. It turns out this has con

News flash: if you go out of your way to classify your entire workforce as contractors, you don't get to decide when they work or not. It turns out this has consequences on both sides. If Lyft wants to decide when their drivers are working, there's a process for this: 1) Hire employees 2) Give them a schedule 3) Pay them hourly plus mileage

lexs 7y ago
And suddenly Uber/Lyft are like any other Taxi company just with a massive valuation.
- madeofpalk 7y ago
  Exactly.
- metalliqaz 7y ago
  If their workforce suddenly switched from contractor to employee, I expect that valuation would evaporate.
- wlesieutre 7y ago
  There's probably a balance to be struck, because part of the ridesharing design's efficiency is that if demand drops they can drop their rates paid to drivers, and the drivers who don't want to drive at those prices will stop. So if Lyft starts to say "we always want X drivers available as a base load, and we'll open up to contractors to fill in the demand spikes" it might make the contractor role too unreliable for anyone to bother doing it. At the very least, their costs would go up for both the employed drivers and the extra contractor drivers. Since their valuations comes mainly from a cheap labor pool, that presumably kills it. But in the current situation, if all their drivers at the airport sign off and say "I'm not driving at these prices," you get surge pricing to make it worth driving, that increases costs too. That's what happens when you're buying labor from independent contractors - if they don't want to sell it to you at a particular time for any reason, they don't have to. The real question here is "If Lyft recognizes when these organized sign-offs are happening, calls their bluff, and refuses to activate surge pricing, what happens?" Do the drivers really refuse to drive at the regular pricing and go home? Or do they all give in to a more tamper-resistant algorithm and keep driving at regular rates?
  - ErikVandeWater 7y ago
    > Or do they all give in to a more tamper-resistant algorithm and keep driving at regular rates? I wonder if they will change the algorithm to just tell the drivers what they want to hear. To wit - Introduce a new multiplier for drivers based on their behavior. This will factor into the final price, but be obfuscated. Then Lyft can tell the drivers they are receiving a greater surge than what the rider sees, and pays.
    - jimbokun 7y ago
      I think the drivers need to use the passenger app to see the surge pricing, anyways?
  - lr 7y ago
    Can we please stop referring to these services as "sharing"? Lyft actually started as a company that coordinated the sharing of rides, i.e., no money was involved. But the "sharing" pretense has long since past for all of these companies.
    - thebluehawk 7y ago
      Right? It's nonsense. A grocery store isn't "food sharing", and a barber isn't "hair cut sharing". It's one party paying another for a product/service. Uber/Lyft's killer feature is the app pairing those two parties. But no one is "sharing".
      - papln 7y ago
        google.com/search?q=buy+a+share+of+a+cow
    - egypturnash 7y ago
      We need a new word for "taxi companies with cute apps, unsustainable pricing/wages and lots of Silicon Valley venture capital propping them up" to distinguish them from old-school taxi companies if we're gonna quit saying "rideshare". Any suggestions?
- neaanopri 7y ago
  Well, not for long...
- joering2 7y ago
  Not quite. Real taxi corporations have approval of city/state assembly to do business so that they control the amount of taxi cars being part of daily street flow. (Im ignoring the fact that this system is broken and corrupted)
- seanmcdirmid 7y ago
  > And suddenly Uber/Lyft are like any other Taxi company just with a massive valuation. What taxi companies have drivers as actual employees and not independent contractors?
  - UncleEntity 7y ago
    Almost all of them. You lease a car and anything over lease and gas you get to keep. --edit-- Never mind, read that backwards...
- uxp100 7y ago
  I think they'd retain some of that valuation. Unlike traditional cabs, they show up (I've been stranded by more cabs called by phone then I've taken, not hyperbole). But the value of some unified dispatcher framework, with penalties for abandoning customers probably isn't in the tens of billions. Maybe in the hundreds of millions? Either self driving cars change everything, quite quickly, or some people are going to lose a lot of money.
- toss1 7y ago
  "And suddenly Uber/Lyft are like any other Taxi company just with a massive valuation." . . . which valuation would be rapidly evaporating. I suspect this will happen one way or the other, as something that cannot be sustained will not be -- something's got to give, either rates will go up, costs will go down, or the companies will fold. Rates probably have some room to rise. My limited experience is mostly airport rides, where they are cheaper than limo's taxis. But I'd still pay the same as the competing services, since Lyft has always been more reliable and pleasant. The main competition is parking. Lower costs? I don't think so, short of automation. The drivers' costs & compensation have already evidently been pushed to the limit, as they are starting to strike. Will they sort out either? I'm not buying either stock, even at the discount prices...
- megy 7y ago
  > any other Taxi company Except world wide (or us wide).
deleted 7y ago
[deleted]
chrismeller 7y ago
I find it hard to agree. Hear me out... They are contractors because they do not have any set obligation for time. Rate of pay or overall pay has nothing at all to do with that. According to the IRS they do not have a set schedule and they are contractors (that is 1099, not W2). So they are contractors. What does that have to do with pay? Absolutely nothing. You want x and are willing to pay y. Maybe there’s an opportunity for me to negotiate for z, maybe not. Either way none of that has anything to do with the actual form of employment. Even if I were a salaried employee working 40 hours a week the company has a budget of $40,000 a year and that’s all they will pay. If I demand $45,000 they’ll just tell me no - they simply don’t have the money. In this case Uber offered you $x. You agreed to $x. You have no schedule, which is the perk of the job vs driving a cab, where you will have a schedule. Need to take the kids to school or a doctor’s appointment? Well, work that around your work schedule. And as for your third point... Uber already charges me for both time and mileage. I don’t see any problem with them paying their drivers based on both... but from the drivers I’ve talked to they already do. I can’t speak for any other service at all.
- jakelazaroff 7y ago
  > In this case Uber offered you $x. You agreed to $x. When did they agree on $X? There's no contract between the drivers and Uber stating they they will work for a given amount. The app sets rates based on supply and demand. Uber offers them $X. The drivers decide they don't want to work for less than $Y. If demand is sufficient, Uber eventually offers them $Y. Surge pricing is basically a negotiation between company and driver. Just because the drivers have found a case in which they have extra leverage doesn't make it wrong or fraudulent.
  - ummonk 7y ago
    Cartels colluding together to artificially reduce supply in a market is often considered illegal market manipulation. That lyft is acting as a middle-man to set market-clearing prices here doesn't change that.
    - jakelazaroff 7y ago

lexs 7y ago

And suddenly Uber/Lyft are like any other Taxi company just with a massive valuation.

madeofpalk 7y ago
Exactly.
metalliqaz 7y ago
If their workforce suddenly switched from contractor to employee, I expect that valuation would evaporate.
wlesieutre 7y ago
There's probably a balance to be struck, because part of the ridesharing design's efficiency is that if demand drops they can drop their rates paid to drivers, and the drivers who don't want to drive at those prices will stop. So if Lyft starts to say "we always want X drivers available as a base load, and we'll open up to contractors to fill in the demand spikes" it might make the contractor role too unreliable for anyone to bother doing it. At the very least, their costs would go up for both the employed drivers and the extra contractor drivers. Since their valuations comes mainly from a cheap labor pool, that presumably kills it. But in the current situation, if all their drivers at the airport sign off and say "I'm not driving at these prices," you get surge pricing to make it worth driving, that increases costs too. That's what happens when you're buying labor from independent contractors - if they don't want to sell it to you at a particular time for any reason, they don't have to. The real question here is "If Lyft recognizes when these organized sign-offs are happening, calls their bluff, and refuses to activate surge pricing, what happens?" Do the drivers really refuse to drive at the regular pricing and go home? Or do they all give in to a more tamper-resistant algorithm and keep driving at regular rates?
- ErikVandeWater 7y ago
  > Or do they all give in to a more tamper-resistant algorithm and keep driving at regular rates? I wonder if they will change the algorithm to just tell the drivers what they want to hear. To wit - Introduce a new multiplier for drivers based on their behavior. This will factor into the final price, but be obfuscated. Then Lyft can tell the drivers they are receiving a greater surge than what the rider sees, and pays.
  - jimbokun 7y ago
    I think the drivers need to use the passenger app to see the surge pricing, anyways?
- lr 7y ago
  Can we please stop referring to these services as "sharing"? Lyft actually started as a company that coordinated the sharing of rides, i.e., no money was involved. But the "sharing" pretense has long since past for all of these companies.
  - thebluehawk 7y ago
    Right? It's nonsense. A grocery store isn't "food sharing", and a barber isn't "hair cut sharing". It's one party paying another for a product/service. Uber/Lyft's killer feature is the app pairing those two parties. But no one is "sharing".
    - papln 7y ago
      google.com/search?q=buy+a+share+of+a+cow
  - egypturnash 7y ago
    We need a new word for "taxi companies with cute apps, unsustainable pricing/wages and lots of Silicon Valley venture capital propping them up" to distinguish them from old-school taxi companies if we're gonna quit saying "rideshare". Any suggestions?
neaanopri 7y ago
Well, not for long...
joering2 7y ago
Not quite. Real taxi corporations have approval of city/state assembly to do business so that they control the amount of taxi cars being part of daily street flow. (Im ignoring the fact that this system is broken and corrupted)
seanmcdirmid 7y ago
> And suddenly Uber/Lyft are like any other Taxi company just with a massive valuation. What taxi companies have drivers as actual employees and not independent contractors?
- UncleEntity 7y ago
  Almost all of them. You lease a car and anything over lease and gas you get to keep. --edit-- Never mind, read that backwards...
uxp100 7y ago
I think they'd retain some of that valuation. Unlike traditional cabs, they show up (I've been stranded by more cabs called by phone then I've taken, not hyperbole). But the value of some unified dispatcher framework, with penalties for abandoning customers probably isn't in the tens of billions. Maybe in the hundreds of millions? Either self driving cars change everything, quite quickly, or some people are going to lose a lot of money.
toss1 7y ago
"And suddenly Uber/Lyft are like any other Taxi company just with a massive valuation." . . . which valuation would be rapidly evaporating. I suspect this will happen one way or the other, as something that cannot be sustained will not be -- something's got to give, either rates will go up, costs will go down, or the companies will fold. Rates probably have some room to rise. My limited experience is mostly airport rides, where they are cheaper than limo's taxis. But I'd still pay the same as the competing services, since Lyft has always been more reliable and pleasant. The main competition is parking. Lower costs? I don't think so, short of automation. The drivers' costs & compensation have already evidently been pushed to the limit, as they are starting to strike. Will they sort out either? I'm not buying either stock, even at the discount prices...
megy 7y ago
> any other Taxi company Except world wide (or us wide).

deleted 7y ago

[deleted]

chrismeller 7y ago

I find it hard to agree. Hear me out... They are contractors because they do not have any set obligation for time. Rate of pay or overall pay has nothing at all to do with that. According to the IRS they do not have a set schedule and they are contractors (that is 1099, not W2). So they are contractors. What does that have to do with pay? Absolutely nothing. You want x and are willing to pay y. Maybe there’s an opportunity for me to negotiate for z, maybe not. Either way none of that has anything to do with the actual form of employment. Even if I were a salaried employee working 40 hours a week the company has a budget of $40,000 a year and that’s all they will pay. If I demand $45,000 they’ll just tell me no - they simply don’t have the money. In this case Uber offered you $x. You agreed to $x. You have no schedule, which is the perk of the job vs driving a cab, where you will have a schedule. Need to take the kids to school or a doctor’s appointment? Well, work that around your work schedule. And as for your third point... Uber already charges me for both time and mileage. I don’t see any problem with them paying their drivers based on both... but from the drivers I’ve talked to they already do. I can’t speak for any other service at all.

jakelazaroff 7y ago
> In this case Uber offered you $x. You agreed to $x. When did they agree on $X? There's no contract between the drivers and Uber stating they they will work for a given amount. The app sets rates based on supply and demand. Uber offers them $X. The drivers decide they don't want to work for less than $Y. If demand is sufficient, Uber eventually offers them $Y. Surge pricing is basically a negotiation between company and driver. Just because the drivers have found a case in which they have extra leverage doesn't make it wrong or fraudulent.
- ummonk 7y ago
  Cartels colluding together to artificially reduce supply in a market is often considered illegal market manipulation. That lyft is acting as a middle-man to set market-clearing prices here doesn't change that.
  - jakelazaroff 7y ago