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Uber, Lyft Drivers Struggle With High Gas Prices

When Adam Potash started driving for Lyft six months ago to help make ends meet, he was happy with the pay. The business was far from lucrative, but he was making about $200 a day before paying for costs like gas and car maintenance.

But as gas prices have risen in recent weeks, Mr. Potash has barely been breaking even. To compensate, he has focused on driving during peak customer hours and tried to fill up at cheaper gas stations in the area around San Francisco where he works. He has also reduced his driving time from about 45 hours each week to roughly 20 hours.

“It hurts. I don’t have money coming in,” Mr. Potash, 48, said of his reduced hours. “But I’m not willing to operate at a loss.”

Gig workers who drive for ride-hailing and delivery companies like Uber, Lyft and DoorDash have been hit hard by rising gas prices, because their ability to earn money is tied directly to driving hundreds of miles each week. And because the drivers are contract workers, the companies do not reimburse them for the cost of fueling up.

blog post on Monday.

DoorDash announced a gas rewards program on Tuesday. Those who use a prepaid debit card designed for DoorDash workers will get 10 percent cash back at gas stations, the company said, and DoorDash is adding bonus payments depending on miles driven. Grubhub also said it would boost driver pay.

Both Uber and Lyft say drivers have been making more money since lockdowns lifted than they did earlier in the pandemic or even prepandemic, even when accounting for rising gas prices. And both companies are promoting a partnership with an app called GetUpside that offers some cash back rewards for getting gas.

Gridwise, an app that helps drivers track their earnings and tallies data, found that drivers’ earnings had risen nationally in recent months, from an average of $308 per week in early January to $426 in early March. But gas costs for ride-hailing drivers have also gone up, from $31 per transaction to nearly $39 in the same period.

Uber and Lyft say the entirety of their new gas fees — 35 to 55 cents per trip for Uber and 55 cents for Lyft — will go to the drivers. But some drivers say the action is inadequate. Gas prices, on average, have increased 49 percent in the past year, according to AAA.

“That literally insulted every driver, and that was their first communication since gas prices were going up,” said Philippe Jean, an Uber and Lyft driver in Coopersburg, Pa.

Jennifer Montgomery, an UberEats driver in Las Vegas, where gas costs $5 per gallon, agreed that the gas fee “doesn’t even put a dent” in the cost of fuel, which for her has been at least $30 more each day since prices began to increase.

Ms. Montgomery, 40, said she was becoming disillusioned with the job, and had begun looking for other work that didn’t require her to drive. She has cut her six-hour, daily shifts in half, because “it’s really not a profit anymore.”

“I don’t want to deliver anymore,” she said. “Especially when you have bills to pay and rising cost of rent and mortgage, groceries — it affects everything.”

Mr. Jean mostly drives for Uber and Lyft during the winter and spring, when his work as a handyman tends to slow down. He said he enjoyed interacting with passengers and usually made $300 to $400 per week, with about $60 of that going to filling his tank.

Lately, though, Mr. Jean has been paying twice that amount for gas, and has had to cut back elsewhere to compensate — including by reducing his car insurance coverage.

“I’m driving Uber now hoping not to get in an accident, because if I do, I’m going to lose my car completely,” he said.

The gas price woes have actually caused Mr. Jean to drive more in the short term, because people with cars that get poor gas mileage have told him they have stopped driving. With his hybrid Toyota Prius, he figured he would be able to snap up some of their business and still be able to make some money. But Mr. Jean said he would most likely give up Uber altogether later in the spring when his handyman work picks up again, because of the high gas prices.

He questioned whether he or other drivers were even profiting from the ride-hailing business at all, after all of the costs involved.

“I think personally if I sat down and did the numbers, it would be break-even,” Mr. Jean said. “I don’t think we’re making money on it anymore. I think I’m afraid to admit it to myself, because then I would definitely stop doing it.”

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California’s Gig Worker Law Is Unconstitutional, Judge Rules

A California law that ensures many gig workers are considered independent contractors, while affording them some limited benefits, is unconstitutional and unenforceable, a California Superior Court judge ruled Friday evening.

The decision is not likely to immediately affect the new law and is certain to face appeals from Uber and other so-called gig economy companies. It reopened the debate about whether drivers for ride-hailing services and delivery couriers are employees who deserve full benefits, or independent contractors who are responsible for their own businesses and benefits.

Last year’s Proposition 22, a ballot initiative backed by Uber, Lyft, DoorDash and other gig economy platforms, carved out a third classification for workers, granting gig workers limited benefits while preventing them from being considered employees of the tech giants. The initiative was approved in November with more than 58 percent of the vote.

But drivers and the Service Employees International Union filed a lawsuit challenging the constitutionality of the law. The group argued that Prop. 22 was unconstitutional because it limited the State Legislature’s ability to allow workers to organize and have access to workers’ compensation.

his ruling that Prop. 22 violated California’s Constitution because it restricted the Legislature from making gig workers eligible for workers’ compensation.

“The entirety of Proposition 22 is unenforceable,” he wrote, creating fresh legal upheaval in the long battle over the employment rights of gig workers.

“I think the judge made a very sound decision in finding that Prop. 22 is unconstitutional because it had some unusual provisions in it,” said Veena Dubal, a professor at the University of California’s Hastings College of Law who studies the gig economy and filed a brief in the case supporting the drivers’ position. “It was written in such a comprehensive way to prevent the workers from having access to any rights that the Legislature decided.”

Scott Kronland, a lawyer for the drivers, praised Judge Roesch’s decision. “Our position is that he’s exactly right and that his ruling is going to be upheld on appeal,” Mr. Kronland said.

ballot proposal that could allow voters in the state to decide next year whether gig workers should be considered independent contractors.

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