This report addresses a critical public policy challenge facing the City of New York—the low pay of app-based drivers. In this preface, we outline our charge from the City’s Taxi and Limousine Commission (TLC) concerning a minimum pay standard for these drivers, we summarize our policy design discussions, and we present the key findings that we detail in this report.
At the outset, the TLC pointed to the growth in the number of app-based for-hire-vehicles (FHV) and drivers and suggested a possible link to downward pressure on driver earnings. In response, the TLC drafted a policy to ensure minimum earnings for drivers of for-hire vehicles. Drivers would receive a minimum payment per mile and per minute spent transporting passengers. FHV bases would be required to ensure that drivers to whom they dispatch trips do not fall below these minimums over a set period of time. The TLC asked us to evaluate and provide feedback on a proposed policy and to analyze the likely effects. We discussed four policy design questions with the TLC, including how to overcome the reduction of driver trips per hour that might occur if drivers increase their hours in response to increases in driver compensation per trip.