Uber and Lyft reportedly explore franchise model


Illustration from article titled Uber and Lyft: Okay But What If The Franchises, Well?

Photo: JOSH EDELSON / AFP (Getty Images)

California ridesharing giants Uber and Lyft are always looking for ways sidestep state attempts to classify their drivers as full-time employees, and the long game at this point appears to be a measure of the November poll. But the two companies have also reportedly explored other workarounds, including the extreme measure of licensing their brands to fleet operators. You know, like a cab service – the supposedly moribund industry that these companies were supposed to supplant.

Citing sources familiar with the subject, the New York Times reported Tuesday that the two companies had considered operating more as a black car service in California, possibly to avoid paying their drivers’ benefits. According to the newspaper, the plan would see Uber and Lyft as platforms for other companies to build their own ride-sharing fleets, a smart trick that would allow Uber and Lyft to distance themselves from the work side of their businesses and operate. more like a simple shipping service.

The details of how such a model works are unclear. In theory, operating in this way may allow Uber or Lyft to argue that these are software platforms whose transportation services are not necessarily at the heart of their business (as they did, with limited success.) The viability of this argument would obviously depend entirely on these unknowns, primarily what level of control over which Uber drivers would be willing to give in under such a model. A spokesperson for Uber told Gizmodo in an emailed statement that the company was “not sure whether a fleet model would ultimately be viable in California.”

“It’s similar to the way Uber Black operated ten years ago, with higher prices and less reliability,” the spokesperson said. “In some models, drivers bring their own car; in others, the cars belong to the fleet. Either way, drivers would likely earn a predetermined hourly wage for their time spent on the app – but, in return, fleets would need to monitor and enforce driver activity and efficiency, for example by putting drivers on shifts, dictating where and when to drive, and applying travel acceptance criteria. “

Mtout Uber cars are already part of fleets, especially in New York, mainly due to the difficulty in obtaining operating licenses.

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Both companies have threatened to close temporarily in the state if they are forced to comply with AB5, although both also rely on the success of a voting measure, Proposition 22, who will vote in November. This move would allow app-based concert employers to bypass some of the benefits given to drivers with a full-time employee classification.

When contacted by Gizmodo to comment on the reported licensing plans, a Lyft spokesperson said only that “alternative models” had been explored and reaffirmed the company’s position on Proposition 22.

“We looked at alternative models, and the one that would work best for drivers is what we are supporting in the ballot: They remain independent and can work when they want while receiving additional health care benefits and ‘a guaranteed income, ”Julie Wood, a spokesperson for Lyft, said in a statement.

Lyft and Uber could shut down as early as this week if they are forced to comply with AB5, although it does not appear to be in Uber or Lyft. best interests cease operations. Such a move would also disproportionately punish drivers who rely on these companies for income in a time of unprecedented economic uncertainty – albeit given the general indifference of employers to the welfare of their workers. human workers, would that be really surprising?


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