New York traffic

Minimum wage coming in for New York app-based drivers

This could finally spell the end of the battle between taxi drivers and app-based drivers

You know that battle that's been going on between New York cab drivers and Uber drivers since pretty much the dawn of time? They just took a big step in the direction of peace and ❤️.

What it means: New York is  set to become the first major US city to set a minimum wage for drivers. and put a cap on the number of ride-hail vehicle licenses.

There are 80,000 app-based cars in New York, and just 13,500 yellow cabs. The city government won't issue any more licenses for 12 months except wheelchair accessible ones.

They're also setting a minimum wage for ride-hail vehicle drivers. Because they're independent contracts, app-based drivers don't get the federal or state minimum wage - this is the first time there's any kind of regulation on what they're paid.

How much? As yet unclear, but there's some fiddly maths going into working it out.

Basically, Uber's saying if you pay drivers more, they'll want to work more hours, and there won't be enough customers. Two economists have worked out a formula by which Uber actually pays drivers more if they're spending too much time not driving passengers around - like a punishment for employing more drivers than there are customers. That should incentivise the company to 'self-regulate', and get to exactly the right ratio of supply and demand. This Quartz article explains how.

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