# California AG and cities sue Uber and Lyft



## UberProphet? (Dec 24, 2014)

California Attorney General Xavier Becerra is suing Uber and Lyft, alleging the ride sharing companies have misclassified their drivers as contractors.

City attorneys from San Francisco, Los Angeles and San Diego have joined Becerra in the lawsuit.

The lawsuit gets to the heart of a recent debate between gig economy companies and California officials over a new California law known as Assembly Bill 5 (AB5).
https://www.cnbc.com/2020/05/05/cal...uber-and-lyft-over-worker-classification.html


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## SHalester (Aug 25, 2019)

Lock AB5 4ever in the courts. I have no desire to be an 'employee'.


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## dnlbaboof (Nov 13, 2015)

I don't know why people hate on this. Ab5 is to protect us. The bill doesnt provide health care and you could lose your health care(since Obamacare is tied to income) and pay way more taxes if you cant deduct your miles, but ab5 will give us sick pay if you have the sniffles. It also doesn't increase the rate per mile, but you can set the destination filter to your neighbors house and collect minimum wage. But they will take the dest filter away with AB5, so that will last a week or so.

The app will work like amazon flex you fight for shifts that arent usually there. You'll have to pick up 4.1 pools or be fired if you're lucky enough to get a shift since thousands of drivers will fight for shifts. All in all Ab5 really helps drivers a lot. It will help you become unemployed and never drive for Uber.


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## SHalester (Aug 25, 2019)

dnlbaboof said:


> All in all Ab5 really helps drivers a lot. I


well, that's just wild speculation as nobody knows how RS would implement making us 'employees'. I for one would not tolerate any changes to going online/offline when i want. Working the days I want. Working how many hours I want. Or any other 'control'. 
If it was just more money and no other changes, sure why not; call me whateverthefrak you want.


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## losiglow (Dec 4, 2018)

As much as I want more pay, the other half of the equation is where the money is going to come from. Uber and Lyft can't seem to make a profit despite all of their efforts. Not that I'm necessarily worried about them going out of business (rideshare is here to stay, regardless of what company is running it) but I do question where the money is going to come from.

And don't tell me "Dara makes eleventy-billion dollars. That should be shared amongst the drivers!!!11!". Yeah, it's unfair what some CEO's make but if you divided his annual salary amongst millions of drivers, we'd all get like, $11. Literally. (Dara made $45 million last year. 3.9 million drivers = 45m / 3.9m = $11.50)

So who's going to pay for all these extra benefits and pay? They'd have to raise fares to taxi-level in order to fund it.


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## dnlbaboof (Nov 13, 2015)

Uber should just leave california, give those democratic nutjobs what they really want......a 5th world country where a sick cancer patient cant get a ride from the hospital.............


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## UberProphet? (Dec 24, 2014)

losiglow said:


> They'd have to raise fares to taxi-level in order to fund it.


And the problem with that is?


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## SHalester (Aug 25, 2019)

losiglow said:


> They'd have to raise fares to taxi-level in order to fund it.


fine with me if pax still pays it. I just don't want to be an employee again because I know exactly what that means. No thanks, pass.


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## Karen Stein (Nov 5, 2016)

"The problem" with rideshare following in the steps of the taxi model is that the taxi model failed. The only reason rideshare exists at all is because taxis simply failed to give the market what the market wanted.
Step by step, always announced with the best intentions, the taxi model moved away from any market accountability. This created the need for rideshare.

Oddly enough, cab drivers did worse under the taxi model than I currently do with rideshare. I know, as I drove a cab in the days before rideshare.
Why would I want a return to the bad old days?


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## The Gift of Fish (Mar 17, 2017)

losiglow said:


> So who's going to pay for all these extra benefits and pay? They'd have to raise fares to taxi-level in order to fund it.


That's Uberlyft's argument. "But we won't be able to survive if we have to pay drivers wages and reimburse them for their vehicle expenses and pay for their healthcare like every other company does!", they cry. Well, this just proves that they don't have a viable business. Let them fold and because, as you say, rideshare isn't going to end, with Uberlyft gone, the leaner, more efficient rideshare 2.0 companies will arrive.

The assumption that many make is that "Uberlyft must survive, and how can they do that if they're made to pay their way". The answer is that they don't have to survive.


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## IRME4EVER (Feb 17, 2020)

Karen Stein said:


> "The problem" with rideshare following in the steps of the taxi model is that the taxi model failed. The only reason rideshare exists at all is because taxis simply failed to give the market what the market wanted.
> Step by step, always announced with the best intentions, the taxi model moved away from any market accountability. This created the need for rideshare.
> 
> Oddly enough, cab drivers did worse under the taxi model than I currently do with rideshare. I know, as I drove a cab in the days before rideshare.
> Why would I want a return to the bad old days?


I WAS A CAB DRIVER FOR 12 YEARS, BEFORE JOINING UBER. UBER DOESN'T CARE ABOUT US AS DRIVERS. THEY CUT OUR PAY, EXPECT US TO DO EVERY TRIP REQUESTED, EVEN IF IT'S 20 MINUTES P/U FOR A 4 MINUTE TRIP. WHO IS GETTING SCREWED HERE? NOT UBER!! WE ARE THE DRIVERS!!


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## SHalester (Aug 25, 2019)

The Gift of Fish said:


> the leaner, more efficient rideshare 2.0 companies will arrive


er, em, ah. like tryp?


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## eazycc (Apr 5, 2019)

dnlbaboof said:


> Uber should just leave california, give those democratic nutjobs what they really want......a 5th world country where a sick cancer patient cant get a ride from the hospital.............


SF and LA are 2 of their biggest markets. Add that on top of the fact that California is the biggest economy ....and Uber/Lyft was founded in SF, it would be pretty embarrassing, along with a massive hit in revenue


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## dnlbaboof (Nov 13, 2015)

eazycc said:


> SF and LA are 2 of their biggest markets. Add that on top of the fact that California is the biggest economy ....and Uber/Lyft was founded in SF, it would be pretty embarrassing, along with a massive hit in revenue


Well if they lose the ab5 battle they will have to leave they will have to pay tons of fines and they will leave and you can thank of all the idiots in Sacramento.

The other option is to pay unemployment sickleave healthcare which will be so expensive they would probably just rather leave plus it was set a precedent that they gave in and then They would have to do it every other state. Not gonna work there's no point just leave it as it is and just increase the rate per mile


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## Phil Lee (Apr 29, 2019)

Karen Stein said:


> "The problem" with rideshare following in the steps of the taxi model is that the taxi model failed. The only reason rideshare exists at all is because taxis simply failed to give the market what the market wanted.
> Step by step, always announced with the best intentions, the taxi model moved away from any market accountability. This created the need for rideshare.
> 
> Oddly enough, cab drivers did worse under the taxi model than I currently do with rideshare. I know, as I drove a cab in the days before rideshare.
> Why would I want a return to the bad old days?


One could argue there never was a business model for a national taxi company.


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## Quicksilver 5 5 5 (Mar 7, 2020)

I'm glad that I drive in Indianapolis, and I got my sba upto 10,000.00 loan yesterday...at least $1000.00's of it. I don't see many TAXI drivers on the street nowadays, just seen one damn taxi, wonder where they went.


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## SWside (Oct 20, 2019)

This might be a dumb question but I’ll stick my neck out. 

Having a software development background, I’d say an app like Uber takes $1M to develop. Ten geeks, one year. Then maybe one geek kept on for enhancements and bug fixes. 

What if a new RS company was started that was driver owned? The way Ocean Spray and Welch’s are owned by the farmers. 
To join you’d have to pay perhaps $100, after that, $10 a year for ongoing costs. (I’m making those numbers up as I don’t know how many RS drivers there are in this country to spread the cost. Does anyone know?)

But 100% of the fare would stay for drivers. 

The public might not want to try a new RS company at first. It might take a little marketing to explain the difference between the new company and Uber/Lyft. 

But once the news spread I think most consumers would enjoy paying 10% less and knowing the drivers were making 30% more.


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## UberBastid (Oct 1, 2016)

dnlbaboof said:


> I don't know why people hate on this. Ab5 is to protect us.


I will try to explain it to you.
MOST of the people who drive RS are very independent people. 
They are responsible for their own income, and they pay their own bills, and somehow they make it all work.
They do not want a nanny looking out for them. They don't want to be 'protected', they can protect themselves. To many of them, the introduction of another layer above does not help; and they recognize that 'protection' comes with cost.

In short ... if they wanted a 'job', they'd go get one.


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## Phil Lee (Apr 29, 2019)

SWside said:


> This might be a dumb question but I'll stick my neck out.
> 
> Having a software development background, I'd say an app like Uber takes $1M to develop. Ten geeks, one year. Then maybe one geek kept on for enhancements and bug fixes.
> 
> ...


Thats the basic idea behind a cooperative. The operational costs.of running a cooperative I guess are equivalent if not higher due the need to meet or exceed the factors of a typical business.

Sometimes there are security savings regarding mutual security protection by having a master contract or Memorandum of Understanding.

A better comparison would be using an economic externality to power an enterprise such as dumping carbon into the atmosphere causing global warming such as Saudi oil money which funded Uber during the pre-IPO stage before EBITDA.


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## DriverMark (Jan 22, 2018)

SWside said:


> This might be a dumb question but I'll stick my neck out.
> 
> Having a software development background, I'd say an app like Uber takes $1M to develop. Ten geeks, one year. Then maybe one geek kept on for enhancements and bug fixes.
> 
> ...


Thing that makes Uber/Lyft so "easy" is the insurance. The promise of "we got you covered".

Move to the model you propose, drivers now have to do a few extra things like get commercial insurance. I'm not saying it's a bad thing, just some of the changes that would be required. The software company could keep $1 per ride and probably still make a killing. One of their biggest expenses is insurance coverage.

Uber needs to can Eats, scooters, trash their Autonomous R&D and partner with another big wig (like Google perhaps?). Just those things would probably bring them to profitability.


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## SWside (Oct 20, 2019)

Phil Lee said:


> Thats the basic idea behind a cooperative. The operational costs.of running a cooperative I guess are equivalent if not higher due the need to meet or exceed the factors of a typical business.


Operational costs of a cooperative would exceed the amount Uber and Lyft are pocketing themselves? Wow. Didn't know cooperatives had huge requirements. Thanks big government.


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## dnlbaboof (Nov 13, 2015)

The best thing about being a w-2 vs IC is not being able to deduct your miles. You'll pay much higher taxes (thats what this is all about), lose your obamacare BUT you'll get reimbursement per mile from uber, Health insurance and sick leave LOL. Yeah right uber can't be profitable now, they'd just end up leaving.

Has California gone mad? Is it really necessary to waste tax dollars like this? When you get 20 bucks for a 20 minute ride from the airport are you really being abused? When you are sitting on facebook waiting for a ping is this the equivalent of working in a coal mine?

Is being a w2 employee the greatest thing? Working at a mcdonalds on your feet all day with a boss breathing down your neck?


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## Phil Lee (Apr 29, 2019)

UberBastid said:


> I will try to explain it to you.
> MOST of the people who drive RS are very independent people.
> They are responsible for their own income, and they pay their own bills, and somehow they make it all work.
> They do not want a nanny looking out for them. They don't want to be 'protected', they can protect themselves. To many of them, the introduction of another layer above does not help; and they recognize that 'protection' comes with cost.
> ...


And other than your o


SWside said:


> Operational costs of a cooperative would exceed the amount Uber and Lyft are pocketing themselves? Wow. Didn't know cooperatives had huge requirements. Thanks big government.


Actually you would be very foolish not to understand and crunch the real numbers. Sometimes big government setting standards is more effective, sometimes its not. It all depends on the specifics. As a public company uber is pretty good at explaining their financials.

This has been a political discussion since private competing fire companies watched houses burn in Philadelphia. That was the start of mutual assurance. Uber people has way too many Uber shills to discuss alternative apps.

Like Trump and the covid opening protests, the effort is obviously astroturfed.

Thats why you have both volunteer and municipal fire departments and a few private fire companies that put out billionaire homes during the recent CA fires.



SHalester said:


> well, that's just wild speculation as nobody knows how RS would implement making us 'employees'. I for one would not tolerate any changes to going online/offline when i want. Working the days I want. Working how many hours I want. Or any other 'control'.
> If it was just more money and no other changes, sure why not; call me whateverthefrak you want.


As the CA person said...turning the app on and off is irrelevant to competing while providing standard worker rights. Unless as a "contractor" you were forced to then provide those benefits to yourself?


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## eazycc (Apr 5, 2019)

dnlbaboof said:


> Has California gone mad? Is it really necessary to waste tax dollars like this? When you get 20 bucks for a 20 minute ride from the airport are you really being abused? When you are sitting on facebook waiting for a ping is this the equivalent of working in a coal mine?


Keep in mind Uber has been freely cutting rates, and dictating the terms of work. Basically they're trying to have it both ways, not paying for employee benefits, as well as dictating wages, and how to do the job. So it's a bit more than what you infer.

Also guess who's on the hook for paying UI benefits for drivers out of work?
Guess who has to pay the medical bill of those full time drivers? 
Guess who isn't paying taxes? Quite a few drivers


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## Mista T (Aug 16, 2017)

It's a shame it had to come to this in the first place. All of this could have easily been avoided had the companies not pushed the envelope when it came to greed.

So here is the state, pissed off because millions of voters are being treated like shit, and they have a choice: do nothing, or force employment status. Those are the two choices. Rock, and a hard place. They chose 'hard place'.

Complain all you will about not wanting to be classified as employees; the blame here rests with Uber and Lyft. Even now, their 'attempts' at appeasing the drivers are too little, too late, and 95% bullshit. They can't even get face masks out to drivers (promised WEEKS ago) to help save lives!

Luckily for me I'm not in CA. It will be fun watching the grand experiment play out. Then, other states will observe and decide how to proceed, hopefully taking the best of it all and avoiding the worst.


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## SHalester (Aug 25, 2019)

Phil Lee said:


> .turning the app on and off is irrelevant to competing while providing standard worker rights.


....and you know that how? Did Uber or Lyft management tell you that? I'm guessing not. So back to wild speculation on how RS companies, if forced, would implement AB5.
I for one am happy with the changes Uber already made, when they weren't forced. PLus, I don't want employee status if anything I enjoy is changed. Selfish, but I own it. RS is not a career; not a gig to find benefits. That would be a W2 job.


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## Bevital (Mar 9, 2017)

UberProphet? said:


> California Attorney General Xavier Becerra is suing Uber and Lyft, alleging the ride sharing companies have misclassified their drivers as contractors.
> 
> City attorneys from San Francisco, Los Angeles and San Diego have joined Becerra in the lawsuit.
> 
> ...


If Uber can require "their" drivers to wear masks, then it is no longer my business . . . and if it is not my business . . . must be theirs and I am their employee. (Not what I want, I want to run and operate my business in the way I see fit).


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## UberBastid (Oct 1, 2016)

Mista T said:


> It's a shame it had to come to this in the first place. All of this could have easily been avoided had the companies not pushed the envelope when it came to greed.
> 
> the blame here rests with Uber and Lyft.


Isn't that the truth about just about everything.
I used to like to go to our local ball park, and watch the AA teams play.
Buy a beer and dog and sit in the bleachers and root for the home team.

No more.
No beer.
Some jack ass got all drunked up and started a big fight -- took half the Redding PD to break it up.

So, that's it.
No more beer.


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## Phil Lee (Apr 29, 2019)

UberBastid said:


> Isn't that the truth about just about everything.
> I used to like to go to our local ball park, and watch the AA teams play.
> Buy a beer and dog and sit in the bleachers and root for the home team.
> 
> ...


Uber had to issue a memo to employees to not throw kegs out the window of their Las Vegas hotel rooms when they had a meeting. Bro culture, the company was growing like mad. That was then.


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## Tiger360 (Apr 23, 2020)

Praise God!


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## Oscar Levant (Aug 15, 2014)

UberProphet? said:


> California Attorney General Xavier Becerra is suing Uber and Lyft, alleging the ride sharing companies have misclassified their drivers as contractors.
> 
> City attorneys from San Francisco, Los Angeles and San Diego have joined Becerra in the lawsuit.
> 
> ...


In CA, there will be a ballot intitiative, which, if passed, will make that lawsuit moot, right?

I think it has a good chance of passing, rideshare is cheap and popular, people will take the driver's side, and I think most drivers don't want to be employees.



dnlbaboof said:


> I don't know why people hate on this. Ab5 is to protect us. The bill doesnt provide health care and you could lose your health care(since Obamacare is tied to income) and pay way more taxes if you cant deduct your miles, but ab5 will give us sick pay if you have the sniffles. It also doesn't increase the rate per mile, but you can set the destination filter to your neighbors house and collect minimum wage. But they will take the dest filter away with AB5, so that will last a week or so.
> 
> The app will work like amazon flex you fight for shifts that arent usually there. You'll have to pick up 4.1 pools or be fired if you're lucky enough to get a shift since thousands of drivers will fight for shifts. All in all Ab5 really helps drivers a lot. It will help you become unemployed and never drive for Uber.


Look, I hear ya, I would be for AB5, but I've been cabbie for 10 years, and every cab company, all of the big ones, Yellow, United, Checker, they all went out business, without having to be forced to have employees, because, it's simple, this is historically a low profit, or an outright unprofitable business. So the point is there just enough enough money in the retail price pie to afford worker's comp, and that's the real taxicab killer. My gut feeling is if they did this, especially now with the virus, it will be the end of rideshare in CA. Most of the big ones went bankrupt and reemerged as cooperatives. That is kinda what Uber is now, but not quite, since it has an extravagant executive level, one like I've never seen in the history of the transportation biz, these guys are blowing wads of dough like they own castles or something. When I say 'cooperative' the head office is usually just a tiny place were a couple of desks and a few dispatchers are, and that's it. That's what happened for Yellow in San Diego, They used to occupy an entire city block, but now it's just an office. That would not be Uber.


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## Quicksilver 5 5 5 (Mar 7, 2020)

SWside said:


> This might be a dumb question but I'll stick my neck out.
> 
> Having a software development background, I'd say an app like Uber takes $1M to develop. Ten geeks, one year. Then maybe one geek kept on for enhancements and bug fixes.
> 
> ...


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## Fusion_LUser (Jan 3, 2020)

Mista T said:


> Luckily for me I'm not in CA. It will be fun watching the grand experiment play out. Then, other states will observe and decide how to proceed, hopefully taking the best of it all and avoiding the worst.


Take a seat and prepare for a long ride... now that this is in the courts we most likely won't see any resolution until Lyft/Uber run out money to pay lawyer fee's!


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## Stevie The magic Unicorn (Apr 3, 2018)

Ridesharing is going to die once the government cracks down on this employment classification deal.

In California each driver will need to be giving an average of $40 in rides... PER HOUR (customer cost)

Here's how i'm coming to that math.

$13.00-16.30 base pay (min wage varies by city in California)

.535 X 20-25 miles driven = $10.70- $13.37 (law stipulates that employees make min wage after expenses including mileage in personal vehicles)

$23.70-29.67 per hour

X 1.3333 (to give uber a 25% cut)

$31.59- $39.55 PER HOUR

That's how much you need to be getting off the customers _PER HOUR_

With driver pay being $23.70- $29.67 PER HOUR, plus tips.

And...

10% tips on $31.59- $39.55 is $3.16- $3.95 PER HOUR

I just don't think uber can operate and continue to have a customer base where the drivers are bringing $30-40 an hour in customer fares. I just don't think that's a goal you're ever going to hit.. Pre uber in a taxi... $25-30 an hour when it's busy...

Oh and total cotton headed ninny muffins have to be getting paid $23.70- 29.67, not just the top drivers.


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## Phil Lee (Apr 29, 2019)

The Gift of Fish said:


> That's Uberlyft's argument. "But we won't be able to survive if we have to pay drivers wages and reimburse them for their vehicle expenses and pay for their healthcare like every other company does!", they cry. Well, this just proves that they don't have a viable business. Let them fold and because, as you say, rideshare isn't going to end, with Uberlyft gone, the leaner, more efficient rideshare 2.0 companies will arrive.
> 
> The assumption that many make is that "Uberlyft must survive, and how can they do that if they're made to pay their way". The answer is that they don't have to survive.





eazycc said:


> Keep in mind Uber has been freely cutting rates, and dictating the terms of work. Basically they're trying to have it both ways, not paying for employee benefits, as well as dictating wages, and how to do the job. So it's a bit more than what you infer.
> 
> Also guess who's on the hook for paying UI benefits for drivers out of work?
> Guess who has to pay the medical bill of those full time drivers?
> Guess who isn't paying taxes? Quite a few drivers


Behavioral control, (even with an algorithm) means employee. I think I agree with CA that a flexible schedule (turning the app on or off at will) is not the bright line of being a contractor or employee. I have been an employee where I punched a time clock and had scheduled breaks, and an employee where we all agreed how to cover each other for errands, special requests and when to go for breaks. Yet the job with all that flexibility also had a massive amount of rules the other job did not, with hours of required training, and general HR corporate overhead.

In terms of providing a quality user experience to customers, there was no actual difference between Uber and this corporate job, (just a lot less effort to protect worker rights), but the corporate job had definite and extensive HR processes in place in reality did not really offer any real protections against corporate malfeasance.


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## TXUbering (May 9, 2018)

Mista T said:


> It's a shame it had to come to this in the first place. All of this could have easily been avoided had the companies *not pushed the envelope when it came to greed*.


This is generally what happens with businesses like this. I suspect Walmart would've failed once Sam Walton stopped running it with the community in mind, but Walmart has expensive lobbyists and was able to distort policy to line its pockets. The worse part about these manipulative policies is having people that would benefit from legislation voting against their best interest.

I've only been doing RS for almost 3 years and in that short time I've seen a reduction in my income. Have I changed anything in that time? No. Has U/L done anything in that time? Yes, rates have slowly increased.


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## Mista T (Aug 16, 2017)

TXUbering said:


> Have I changed anything in that time?


Actually, you have.

You have gained experience, which should help you INCREASE your income. In theory.


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## TXUbering (May 9, 2018)

Mista T said:


> Actually, you have.
> 
> You have gained experience, which should help you INCREASE your income. In theory.


I have to admit though, that experience may have also hurt me. I noticed that I started to get into a "comfortable rut" and found myself going through the usual routes, turning the app off when I'd get pulled into "bad parts" of town. I figured that probably hurt how the "algorithm" assigned me rides. The experience with my last Uber car taught me that certain parts of town, the riders were a little more rough with my car, which made me feel that there was more depreciation.

But, I do understand your point. U/L consistently lowering our pay probably had a bigger impact on my earnings. It's interesting to see the older threads on here and see how much more income those drivers made.


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## UberGoldPartner (Apr 1, 2020)

dnlbaboof said:


> I don't know why people hate on this. Ab5 is to protect us. The bill doesnt provide health care and you could lose your health care(since Obamacare is tied to income) and pay way more taxes if you cant deduct your miles, but ab5 will give us sick pay if you have the sniffles. It also doesn't increase the rate per mile, but you can set the destination filter to your neighbors house and collect minimum wage. But they will take the dest filter away with AB5, so that will last a week or so.
> 
> The app will work like amazon flex you fight for shifts that arent usually there. You'll have to pick up 4.1 pools or be fired if you're lucky enough to get a shift since thousands of drivers will fight for shifts. All in all Ab5 really helps drivers a lot. It will help you become unemployed and never drive for Uber.


Two words: SELF EMPLOYED!!

When I was doing this back in the hey day, if I was sick I just took a day off. Easy. Quit being a wussy


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