New Jersey taxicab and Uber representatives both denounced a proposed city measure intended to curtail ride-sharing in Newark Wednesday.
The proposal would require Uber drivers pay a $1,500 fee to operate within the city. Uber believes the proposal would put an unfair obstacle on its drivers while taxi companies say ride-sharing ventures should be completely banned. Uber and taxi representatives both made their case against the proposal during a hearing at the Newark City Hall.
“At a time when Newark’s unemployment rate is one of the highest in New Jersey, it is shocking that the city’s elected officials are trying to ban Uber, stopping two thousand Newark residents from earning a living,” Uber New Jersey General Manager Ana Mahony said in a statement to the local NBC affiliate. “There can no longer be any doubt that the power of taxi special interests matters more.”
Uber drivers in attendance added that many simply cannot afford the fee. Ride-sharing services like Uber have quickly grown in popularity in recent years. Taxicabs and their unions have been admittedly opposed to the new business model. Ride-share companies have been able to bypass laws that have been a fundamental part of the taxi industry.
“They have to follow the regulation and the rules like everybody,” Newark Cab Association President Abbas-Abbas said, according to NJ.com. “I’m not happy … They took the ban out.”
Abbas-Abbas added that local taxicabs have already lost 60 to 70 percent of their business because of ride-sharing. Mayor Ras Baraka agreed, while noting the fee is just about fairness to the established taxicabs that have followed the rules. The city has been tough on ride-sharing in the past, including enacting a ban on drivers working around Newark Liberty International Airport.
Uber and similar companies are just part of a growing business model known as the sharing-economy. The model has expanded to many industries beyond just cabs. Companies make digital platforms where individuals can create their own business ventures, which empowers workers to choose their own hours and provides more flexibility on how they work.
Sharing-economy ventures have been able to avoid many laws and workplace regulations because they use contractors as opposed to employees. Unions say workers are being robbed of the benefits they deserve when they are classified as contractors instead of employees.
Newark lawmakers are not alone in their opposition to ride-share drivers. Seattle lawmakers proposed a bill last year that will force sharing-economy ventures to treat their contractors like employees. Federal labor agencies have also worked to undermine the model and make it more like its traditional counterparts. There have also been lawsuits by workers claiming they’re being taken advantage of because they’re classified as contractors.
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