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Uber Facilitated More Than $600M In Tips For Drivers

Uber

Uber, the ride-hailing company, has facilitated more than $600 million of payments in the form of tips to its drivers since it launched its in-app tipping service for drivers in 2017. According to a report, Uber had $50 million in tips in August, but that has grown since then. In May, it launched mid-trip ratings and tips, and that has driven a 30 percent increase in tipping, said Uber Product Manager Dhruv Tyagi.

Rival Lyft hit $500 million in tips facilitated in April, with the average tips increasing by close to 8 percent last year, compared to the year earlier. Lyft, noted the report, is operating in fewer markets than Uber  Lyft is in the U.S. and Canada while Uber has operations around the world. The report noted that Uber drivers are earning the most tips in  Salt Lake City, Utah; San Antonio, Texas; Kansas City, MO; New Orleans, LA; and Nashville, TN. Lyft found that the most generous tippers were located in  New York City, Atlanta, Detroit, Dallas, San Jose, Minneapolis, and Westchester County, NY.

In January, Uber reached a settlement with more than 2,000 New York drivers, agreeing to pay $3 million. Reuters citing a federal court filing in Brooklyn, New York at the time  reported that Uber agreed to pay the $3 million to settle what was a proposed class-action lawsuit, brought on behalf of 2,421 drivers who contend the company took too many fees out of their fares.

The lawsuit alleged a breach of contract for adding sales tax and a fee to the total fare amount, which then boosted the number of service fees owed to the company. The drivers also claimed that Uber misled drivers with guaranteed compensation of $5,000 in the first month of employment. The settlement includes drivers who worked for the ride-hailing company starting from Dec. 29, 2009 and are not currently in arbitration with Uber. In May, Uber agreed to pay up to $80 million to 96,000 drivers in New York after admitting to not paying them enough.

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