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Uber, lyft and other taxis

Uber and Lyft Said to Offer Drivers a Chance to Participate in I.P.O.s

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When Uber and Lyft go public this year, their founders, top executives and investors are set to reap billions of dollars in new wealth.

But one group that helped build up the ride-hailing companies will miss out on most of the rewards: their drivers.

That’s because while Uber’s and Lyft’s full-time employees and investors own company stock that they can convert into cash after the initial public offerings, the millions of drivers who ferry passengers around for the services are independent contractors. That has made them ineligible for stock grants — and bystanders to the coming I.P.O. bonanza.

Now Uber and Lyft, facing the growing inequity between its stockholders and its drivers, are pursuing measures to address the gap. Both intend to set up programs to give cash to some drivers, enabling them to buy company stock at the time of the I.P.O., according to two people who have been briefed on the plans. The drivers can also keep the cash as a bonus, said the people, who declined to be named because they were not authorized to speak publicly.

The programs will not give drivers a major share of Uber’s and Lyft’s stock. Lyft plans to give $1,000 each to drivers who have completed 10,000 rides for the service; those who have done 20,000 rides will receive $10,000, one of the people said. Uber is still mulling its cash program and payout amounts, but they will also be tiered, another person said.

Some in Silicon Valley greeted the move as an awakening by Uber and Lyft. Eric Ries, author of the start-up world’s bible, “The Lean Startup,” and chief executive of LTSE, a new stock exchange, said the move hinted at these companies’ priorities.
“The next generation of companies understand their obligation to share power and prosperity with the community that made them successful,” he said. “It’s no longer optional.”

But many Uber and Lyft drivers had a different view. Don Creery, an Uber and Lyft driver who previously worked on a campaign in Seattle to win collective-bargaining rights for ride-hailing drivers, called the programs a “token gesture.”

“I think we would probably rather get what we wanted all along, which is a fair rate of pay and make enough money to buy stock in companies that might actually be valuable,” Mr. Creery said. Still, he gave the companies credit for “certainly acknowledging us.”

Bhairavi Desai, executive director of the New York Taxi Workers Alliance, an organization that represents taxi and ride-hail drivers, called the efforts by Lyft and Uber “a slap in the face,” especially since the companies “are going to go public on the sweat of the drivers.”

The issue is galling to many drivers because the public offerings of Uber and Lyft are set to mint a new class of billionaires out of an elite group of Silicon Valley entrepreneurs and investors. Uber is estimated to go public at a valuation of as much as $120 billion, and one of its founders, Travis Kalanick, has already become a billionaire by selling some of his company stock to private investors. Lyft, which is likely to unveil its initial public offering prospectus on Friday, was last valued in the private market at just over $15 billion.

Drivers, who have long been at the heart of the ride-hailing business, have made attempts to change their status with Uber and Lyft so that they can be classified as full-time employees. Becoming full-time employees would also give them access to health care benefits and other perks.

But the companies have successfully beaten back these efforts. In California, Uber and Lyft have fended off lawsuits that aimed to win employee status for drivers. In New York, Lyft recently sued to overturn new legislation that would give drivers a minimum hourly wage of about $17.

Uber and Lyft declined to comment on drivers’ reception of the programs. The cash programs were earlier reported by The Wall Street Journal.

Uber has tried to improve its relationship with drivers over the past 18 months, allowing them to accept tips for the first time starting in 2017. In October, Uber asked in a letter to the Securities and Exchange Commission to be allowed to grant equity to drivers even though they are not employees. Uber did not hear back from the S.E.C., one of the people said.

Ultimately, the cash programs would not give drivers the opportunity to earn money from stock in the same way that employees do, said Mary Russell, a lawyer and founder of Stock Option Counsel, a firm that consults with employees on stock compensation.

“It doesn’t seem like a meaningful change to their compensation, in my view,” she said. “It’s more a thank-you for the past and a one-time event.”

Source: https://www.nytimes.com/2019/02/28/technology/uber-lyft-drivers-ipos.html

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Uber, lyft and other taxis

Lyft Is Another Step Closer to Driverless Ridesharing

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Ridesharing company Lyft (NASDAQ: LYFT) inched a little bit closer toward self-driving ridesharing last week when it said in a blog post that it’s adding Chrysler Pacifica hybrids to its autonomous vehicle (AV) testing fleet and opening a new self-driving vehicle test facility.

The new facility, located in East Palo Alto, California, will allow the company to increase the number of AV tests it can run. It will also let the company test how the systems do with different road configurations, including intersections, merging lanes, traffic lights, and similar challenges. The company said in the post that the new facility will let Lyft “further accelerate the speed of innovation.”

Lyft says that it’s driving four times more autonomous miles per quarter than it was just six months ago and has about 400 employees worldwide working on self-driving tech. That figure is likely to expand, considering that Lyft has more than 40 autonomous vehicle job openings listed on its website.

In addition to the new facility, Lyft said that it’s adding Pacifica minivans to its AV fleet, which is the same vehicle that Waymo, Alphabet’s self-driving car company, uses for its public self-driving ridesharing project and AV tests. Lyft said that, “The minivan’s size and functionality provide our team with significant flexibility to experiment with the self-driving rideshare experience.”

Why does all this matter for Lyft’s autonomous-vehicle future? Because to have a successful, public self-driving ridesharing fleet in the coming years, Lyft needs to lay the groundwork right now.

Isn’t Lyft already doing AV testing?

Lyft is, of course, already working on AV testing. The company’s original self-driving test facility has been up and running since early 2018. The company also started a partnership with Waymo earlier this year to test autonomous ridesharing. Additionally, Lyft also works with Aptiv, an AV tech company, and together they’ve created “the largest publicly available commercial self-driving program in the country” and have completed more than 75,000 rides through the partnership.

But the recent announcements by Lyft show that the company is taking its AV focus a bit further. The Pacifica minivans have been used by Waymo’s AV ridesharing program in Phoenix for more than a year now, making them a proven choice for shuttling around ride-hailing passengers. Lyft may not be ready to launch a wide-scale autonomous ridesharing service just yet, but testing out these vehicles likely means that it’s moving past earlier stages of AV testing and is now looking at how its next-generation self-driving tech can handle new vehicles.

Why this matters for Lyft

Lyft and other ride-hailing companies, including Uber, are keeping a close eye on self-driving developments and testing out the technologies themselves because it could eventually become an integral part of their business model. Research from Intel predicts that the AV ridesharing market could be worth $3.7 trillion by 2050.

Additionally, as regulations surrounding ridesharing drivers continue to increase, Lyft is likely looking to AVs to eventually replace some human drivers. Just a few months ago, the state of California introduced a bill that could pave the way for independent contractors, including Lyft’s drivers, to be reclassified as employees. If a version of the bill becomes law and other states follow California’s lead, it could significantly increase operating costs for Lyft. That could be bad news for the company, which is unprofitable right now and hoping to be in the black just two years from now.

While Lyft’s announcements may not seem all that significant right now, investors should know that these baby steps moving the company closer to AV ridesharing could have huge results in the coming years. For now, investors should be pleased that Lyft is beefing up its own AV testing. Each move the company makes now means that it’ll be much more ready for a self-driving ridesharing future.

Source www.nasdaq.com

By Chris Neiger

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Uber, lyft and other taxis

Uber fined $650 million by New Jersey over driver classification

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New Jersey is the latest state to say Uber’s drivers should be classified as employees rather than independent contractors. The state’s Department of Labor and Workforce Development said that because of this misclassification, the ride-hailing company owes it roughly $650 million in unemployment taxes and disability insurance, according to Bloomberg Law.

The Department of Labor reportedly has been trying to get unpaid employment taxes from Uber going back as far as 2015, according to documents obtained by Bloomberg Law. It said the company owed the state $523 million in overdue taxes along with another $119 million in interest and penalties for the last four years. Uber disputes these findings.

“We are challenging this preliminary but incorrect determination,” an Uber spokesman said in an email. “Because drivers are independent contractors in New Jersey and elsewhere.”

Driver classification is an issue that government regulators have been taking a closer look at over the past year. California passed a law in September that could require Uber and other on-demand companies to reclassify their drivers as employees instead of independent contractors. The law is set to go into effect Jan. 1. New York, Oregon and Washington state have considered similar legislation.

Uber, Lyft and several other tech companies have vowed to fight the California law, collectively putting more than $90 million behind a ballot initiative that’ll take the issue to voters next November. Many drivers have said this move is a slap in the face as they struggle to earn a living wage.

Uber’s and Lyft’s business models depend on bringing aboard hundreds of thousands of independent contractors, whose labor is typically cheaper than that of employees. That’s because Uber and Lyft drivers supply and maintain their own cars and also pay for their own health care and benefits, such as sick days or overtime pay.New Jersey is the latest state to say Uber’s drivers should be classified as employees rather than independent contractors. The state’s Department of Labor and Workforce Development said that because of this misclassification, the ride-hailing company owes it roughly $650 million in unemployment taxes and disability insurance, according to Bloomberg Law.

The Department of Labor reportedly has been trying to get unpaid employment taxes from Uber going back as far as 2015, according to documents obtained by Bloomberg Law. It said the company owed the state $523 million in overdue taxes along with another $119 million in interest and penalties for the last four years. Uber disputes these findings.

“We are challenging this preliminary but incorrect determination,” an Uber spokesman said in an email. “Because drivers are independent contractors in New Jersey and elsewhere.”

Driver classification is an issue that government regulators have been taking a closer look at over the past year. California passed a law in September that could require Uber and other on-demand companies to reclassify their drivers as employees instead of independent contractors. The law is set to go into effect Jan. 1. New York, Oregon and Washington state have considered similar legislation.

Uber, Lyft and several other tech companies have vowed to fight the California law, collectively putting more than $90 million behind a ballot initiative that’ll take the issue to voters next November. Many drivers have said this move is a slap in the face as they struggle to earn a living wage.

Uber’s and Lyft’s business models depend on bringing aboard hundreds of thousands of independent contractors, whose labor is typically cheaper than that of employees. That’s because Uber and Lyft drivers supply and maintain their own cars and also pay for their own health care and benefits, such as sick days or overtime pay.

 

“New Jersey is sending a message that the state’s labor laws aren’t dictated by corporations,” Bhairavi Desai, executive director of the New York Taxi Workers Alliance, said in a statement. “It’s a stinging rebuke of the architects of the gig economy, and we hope it permeates across other sectors.”

Even if Uber’s drivers were determined to be employees rather than independent contractors, Uber said the $650 million New Jersey tax fine would be too high — particularly if it’s based on what the company has earned in the state. Uber didn’t disclose the revenue it generated in New Jersey over the past four years, but its combined revenue for all the markets where it operated in 2018 was $11.3 billion.

 

 

 

Source www.cnet.com

By Dara Kerr

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Uber, lyft and other taxis

Adams Clinical removes hurdle to clinical trial participation

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How Adams Clinical increased retention and streamlined operations by switching to Uber.

One of the hardest parts of conducting a clinical trial is identifying willing participants. Once a participant is identified, strict qualifications and an often-lengthy time commitment limits who can participate, and a lack of access to transportation can make it difficult for participants to commit to and complete the study. To help improve recruitment and retention rates, Adams Clinical offered taxi rides to their participants. However, this solution became a burden on operational efficiency since taxis were only accessible to participants who lived close by and required the staff to pay at the end of each ride.

Finding the perfect transportation solution with Uber Health

To expand their transportation offering, Adams Clinical became an early beta partner with Uber in 2016. The team started using Uber’s web dashboard to arrange and pay for rides for participants with just a few clicks. Over the three years of this partnership, the switch to Uber Health simplified operational management, while reducing time spent on recruitment with increased retention rates. The easy-to-use Uber Health dashboard tracked all the rides and processed payments from one centralized interface, allowing the staff to arrange rides without the hassle of paying at the end of each trip. This flexibility, plus the extensive reach of Uber driver-partners in the Boston area, provided Adams Clinical with the transportation solution needed to successfully manage their participants in need of rides—which removed the headache from recruiting and retaining their study participants.

The result: Improved retention rates, simplified financial records, and an overall lift in team morale

By teaming with Uber Health, Adams Clinical enjoys a number of key benefits including:

• Expanded Recruitment—Using Uber Health cut down the length of enrollment by providing a larger pool to recruit from, resulting in a 5 to 10 percent reduction in recruitment time over the last two years. 

• Centralized Billing—All rides are charged to one company credit card, which is then processed at the end of each month to streamline the amount of administrative effort required.

• Reliable Service—Each ride is tracked in the dashboard so the team knows when the participant will be arriving to help keep the rest of the study on schedule.

• Improved Retention—In the first two years of the partnership with Uber, Adams Clinical estimated up to 20 percent fewer people dropped out of a trial when transportation was arranged to and from the clinic.

• Financial Accountability—Details for each ride are available in the dashboard, and can be downloaded to a spreadsheet, offering convenient management with trial-specific reporting per participant.

• Easy to Use—Using Uber Health has been easy for both staff and participants, even among populations without smartphones or passengers new to Uber.

 

by Kendall Brown

Source uber.com

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