Investigation: Uber and Lyft lockouts for 800+ NYC drivers occurred almost every hour of every day, saving the companies hundreds of millions of dollars in pay

One August morning in south Brooklyn, Mohamed Mohamed did what he's done almost every day for nine years: He woke up at 5 a.m. …

Bloomberg 2024-10-12

Context & Ripple Effects

The reported lockouts extend a policy Uber had already introduced during low-demand periods to manage the cost of a local idle-time pay rule, as described in Uber's earlier NYC lockout rollout. The investigation indicates that this was not an occasional operational restriction but a recurring feature affecting a large driver population.

The story also fits a longer record of driver pay conflict, including multicity driver strikes over pay before Uber's IPO. It matters because the dispute is now centered on how apps allocate access to work, rather than solely on per-trip compensation.

First-order effects

More than 800 NYC drivers face repeated periods in which they cannot log on, directly limiting their ability to earn through Uber and Lyft when the apps restrict access.
Uber and Lyft reduce exposure to pay owed for drivers' idle time; the investigation attributes hundreds of millions of dollars in savings to the lockouts.

Second-order effects

Drivers may shift when and where they seek work, or favor platforms that offer more reliable app access, making predictable availability a competitive issue alongside trip demand.
The findings give labor advocates and city officials a concrete basis to scrutinize whether app-based scheduling practices undermine the practical effect of idle-time pay protections.

Third-order effects

If platforms can manage regulated labor costs by controlling access to the marketplace, wage rules may increasingly be contested through product and dispatch design rather than headline pay rates.
The episode points to a broader policy challenge: protections tied to logged-in time may require oversight of algorithmic access rules as well as formal compensation formulas.

The trend: Gig-work regulation is pushing platform labor disputes from stated pay rates toward the algorithms that determine who can work and when.

Discussion

@obrien_kat@mastodon.world @obrien_kat@mastodon.world on mastodon
This is really terrific reporting and use of data by Bloomberg investigating Uber and Lyft's locking drivers out of using the app in order to avoid paying them minimum wages. I suspect this report will both garner enough attention and includes enough detail to thoroughly launch …
@bcmerchant Brian Merchant on x
In order to get around minimum wage laws in New York, where drivers are supposed to be paid for time on the clock in between rides, Uber and Lyft are simply locking them out of the app so there's no record that they're on the roads at that time. Incredible, infuriating story.
@marietjeschaake Marietje Schaake on x
Uber and Lyft using tech to cheat NY drivers from enjoying new minimum wage. How is this not illegal? In NY recently ‘ride share’ was way more expensive than Yellow Cabs too #techcoup ↘️ https://www.bloomberg.com/...
@sarahfrier Sarah Frier on x
A new(ish) part of my job at Bloomberg involves overseeing tech data investigations. That means I get to work with incredible reporters, editors and graphics folks on stuff like this. Please read about how this NYC driver minimum wage law went awry:
@rakeshsfnyc Rakesh Agrawal on x
Fascinating look at the economics of Lyft and Uber when faced with NYC regulations. tl;dr they came up with ways to work around the regulations to not have do “make good” payments. Every regulation has workarounds if you think creatively. https://www.bloomberg.com/...
@jamietarabay Jamie Tarabay on x
Extraordinary reporting on how @Uber and @lyft got away with denying NYC drivers millions in payouts by locking them out of their apps. A @business investigation https://www.bloomberg.com/... via @bbgvisualdata
@mteuzi @mteuzi on x
This right here is a prime example of the brutal exploitation inherent in capitalism. Rideshare drivers toyed with for the sole purpose of squeezing more profit out of them. Uber and Lyft have perfected a system where drivers, like pieces on a chessboard, are strategically [image…
@faycortez Michelle Fay Cortez on x
Uber and Lyft locked NYC drivers out of their apps (essentially how they clocked in), which limited when they could work and slashed their earnings by millions of $$$, a Bloomberg investigation finds. And riders? They lost, too https://www.bloomberg.com/... via @bbgvisualdata
@katiejwells Katie J. Wells on x
Wow. Thank you @natlungfy for these findings. “Lockouts occurred almost every hour of every day... They even happened in high-demand areas, leading to some increased fares b/c there were fewer cars available.” Uber & Lyft does so “to save millions on future driver wages.”
@moreperfectus @moreperfectus on x
A new investigation shows how rideshare apps used a loophole to systematically lower driver pay. Uber and Lyft said they'd only lock out drivers when there's low demand. Instead, lockouts happened almost every hour, every day—costing workers millions. https://www.bloomberg.com/..…
@ericnewcomer Eric Newcomer on x
not a good look for uber. uber depending on drivers who work full-time but wanting to hide the ball on that fact is a problem that has plagued the company from the beginning
@rachelmetz Rachel Metz on x
This is some amazing data-driven reporting from my @business colleagues. Please give it a read!
@keithellison Keith Ellison on x
This is very disappointing, and apparently very unfair - The kind of thing that prompts policy makers to look to get curious.
@sserve Stacie Sherman on x
Incredible Bloomberg investigation here: Uber and Lyft got away with denying NYC drivers millions in payouts by locking them out of their apps. https://www.bloomberg.com/... via @bbgvisualdata
@zerohedge @zerohedge on x
Lina Khan going after Uber and Lyft next https://www.bloomberg.com/...
@pt Parker on x
I genuinely don't understand how these folks thought taxi companies would pay more money per hour without reducing supply to drive up prices. Has nobody in NYC government ever taken an economics 101 course? And now they're tweeting indignantly about it!
@nyccomptroller @nyccomptroller on x
This must read investigation by Bloomberg News found that @Uber and @lyft are locking out drivers “almost every hour of every day.” https://www.bloomberg.com/...
@leonyin Leon Yin on x
NEW INVESTIGATION: Uber and Lyft locked drivers out of work to game a NYC minimum wage law. We crowdsourced screenshots, monitored surge pricing and ran financial models to reveal the devastating impact on drivers. w/ @natlungfy @A_W_Gordon @DeniseDSLu https://www.bloomberg.com/.…
@a_w_gordon Aaron W. Gordon on x
Really proud to work with @LeonYin, @natlungfy and @DeniseDSLu on this one. Imagine having to constantly tap a button in an app all day to find out if you're allowed to work. That's what Uber/Lyft drivers in NYC had to do all summer (and Lyft still does). https://www.bloomberg.co…
@aaschapiro Avi Asher-Schapiro on x
Really incredible finding by Bloomberg show how Uber/Lyft dealt with a minimum wage law in New York: https://www.bloomberg.com/... https://www.bloomberg.com/... [image]
@pt Parker on x
It makes sense that if you pass laws requiring certain pay, taxi companies will give some drivers more work and some drivers no work rather than eating the cost of paying them to sit around. This article makes it sound like a conspiracy, but these companies are highly
@kirker Jeff Kirk on x
I didn't think the rideshare situation in NYC could get any more FUBAR, but this new summer-of-lockouts bullshit is utterly absurd. Uber & Lyft are, as always, being total assholes, but the crux of the problem is NYC's unworkable minimum-wage rules. https://www.bloomberg.com/...
@leonyin Leon Yin on x
Uber and Lyft don't share data on lockouts, so we built a WhatsApp tipline and shared it with worker groups, web forums, and distributed flyers to drivers directly. We crowdsourced +7K screenshots from <900 drivers (~1% of registered NYC drivers). https://www.bloomberg.com/... [v…
@leonyin Leon Yin on x
The core promise of the gig-economy is flexibility. However, Uber and Lyft locked out drivers nearly every hour of every day w/ no notice. Including during peak hours and Uber “open access times” when drivers are told they can work. https://www.bloomberg.com/... [image]
@axelmerk Axel Merk on x
@LeonYin ... this is a perfect example of how regulations have unintended consequences and the fix makes it worse. Instead of fixing the underlying issue, I trust local rules will double down with drivers losing out. Get rid of the underlying issue, the minimum wage law.
@josheidelson Josh Eidelson on x
“lockouts occurred almost every hour of every day...They even happened in high-demand areas, leading to some increased fares...By making drivers seem busier on paper, the companies set themselves up to save as much as 100s of millions” https://www.bloomberg.com/... @natlungfy @Le…
@rayprisament @rayprisament on x
I am curious, when you read this, do you come away thinking it is uber/lyft's fault as the article implies, or the city's fault for imposing an expensive and weirdly complex new regulation on those companies? Seems pretty clearly the latter to me? https://www.bloomberg.com/...
r/uber r on reddit
How dirty stinky stench Uber and Lyft Used a Loophole to Deny NYC Drivers Millions in Pay
r/newyorkcity r on reddit
How Uber and Lyft Used a Loophole to Deny NYC Drivers Millions in Pay
r/nyc r on reddit
How Uber and Lyft Used a Loophole to Deny NYC Drivers Millions in Pay

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