Earlier this week, Uber drivers took to the streets outside the company’s offices in Queens to protest the way Uber pays its drivers.
One of their grievances is Uber’s policy for allowing drivers to collect tips. Or, we should say, their grievance is that Uber doesn’t let them collect tips.
An UberSUV driver named Hilal Aissani told Business Insider at Monday’s protest, “Uber tells the customer that their tip for the driver is included, but it isn’t. Drivers never see a dollar of that tip money.”
Naresh Motwani, an UberSUV driver, says he signed up with Uber in April and regrets it. When Motwani signed up with Uber, he asked about the tip policy. “The answer I got was ‘we do not charge tip. We give an all inclusive fare to the customer.’ I asked, what if the customer wants to tip anyway? Her response: ‘Do not accept any tip from the customer.’ I do not remember if she said to tell them the tip is included.”
Many of Motwani’s customers want to tip him extra, but he has no option of adding a tip to his customers’ fare. So some of them give him cash.
In a section of its website called “Do I Have To Tip My Driver?” Uber says:
“Being Uber means there is no need to tip drivers with any of our services.
When using uberTAXI (requesting a ride from a cab via the Uber app, available in select cities), drivers will input the metered fare into the Uber driver application. A default 20% of the metered fare will be automatically added and paid to the driver as a gratuity. You can select the percentage amount of the gratuity by signing into your account at uber.com then clicking the ‘Payment’ link at the top.”
A spokesperson from Uber told Business Insider, “There is no need to tip with UberBLACK or UberX.”
It’s a confusing policy, and Uber doesn’t make it any easier to understand. Even riders are confused.
In a thread called “I thought we didn’t tip on Uber, how do we do that?” on the driver forum UberPeople, an Uber customer asked drivers for guidelines on Uber’s tipping policy. The drivers who responded had similar things to say.
“Unless you use UberTaxi, there’s no tip. UberX drivers aren’t receiving any tips. They’re not required. However if you insist, we will gladly accept it,” a driver named Chicago-Uber said. Another driver, whose username is LAuberX, added, “Tipping waiters is not ‘required.’ Play on words, not funny Uber.”
Despite riders thinking a tip is included in their fare, these drivers make it clear that it’s not.
Another driver on the forum, TrafficSlayer, said:
“The fares are the fares, we do not get any ‘bonus money’ from Uber. When you pay your fare, Uber takes their $US1 ‘safe rides fee’ off the top, then takes an additional 20%, the rest is given to the drivers.
$4 min. fare – $US1 safe ride fee – 20% = $US2.40 to your driver total. Out of this the driver must pay for gas and all other expenses. Uber takes 40%.
$10 fare – $US1 safe rides fee – 20% = $US7.20 to your driver. Uber takes 28%.
There is no tip ‘included’ in the fare. In fact, the smaller the fare is, the less of it the driver actually gets. If you take a short ride, things to consider are the following:
What is the driver’s ETA from the time of your request?
How long did your drive take?
Did you make your driver wait for you, or were you waiting for him?
These are important because we live in a world where we expect to be paid for our time. If a driver only gets minimum fares, he is not even making minimum wage when you figure out his hourly rate, especially after you deduct expenses. Even a small $US2 tip will give a significant boost to your driver’s hourly earnings and will be greatly appreciated.”
But Uber warns drivers accepting cash tips from riders is risky. Business Insider obtained an email sent to an Uber driver in Los Angeles from Uber LA, warning a driver for accepting tips.
Subject: Warning # 1 – Accepting Tips
Hi there — we’ve received reports from clients that you’ve been accepting/soliciting cash tips. Accepting tips is against Uber policy — you should NEVER accept tips from clients. Please discontinue immediately. If we find out that you have been, your account will be deactivated. We’ve calculated the average fare with tip for drivers in Los Angeles and have ALREADY adjusted our fares to compensate you accordingly to make the clients’ ride as smooth and efficient as possible.
John Fragoulias, an unhappy Uber driver, said Uber is “telling the customer that the tip is included in the fare, which we all know it is not. If it was, it should be a separate line item in our weekly invoices. And if they say that it is, then they should not take a cut ‘percentage’ off our tips from their weekly 20% Uber cut, since they take that from the gross fare, which means they are dipping into our tips.” Fragoulias drives for Uber, but he’s also started driving for Lyft. “In our daily and weekly summary [for Lyft], the tip, if there is one from a customer, is a separate line item, like it should be,” he told Business Insider.
“Uber has always said in their marketing material, ‘no need to tip, it’s all included!'” One Uber driver who wished to remain anonymous told Business Insider.
“All Uber’s marketing and driver training material made claims that the tip was included and not to tip or receive tips. But they were always dismissive of drivers asking for clarification and transparency. Things like ‘how much of the fare is the tip’ are ignored,” this driver said. “As a passenger too, if you write support and ask how much of the fare is the gratuity they won’t respond. I believe this is an immoral strategy on their behalf to keep themselves artificially cheaper than their competition, like Lyft and Sidecar, who allow tipping through the app.”