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7 min read

    7 min read

    Harry here. As rideshare drivers, we’re actually considered business owners, but what does that actually mean? In some cities, it could mean you have to pay a license you never even knew about. Today, senior RSG contributor Christian Perea covers how business licenses could become a nightmare for us drivers, and how Uber is actually helping us fight it.

    Whether you realize it or not, every rideshare driver in the country is technically a business owner. And if you’re a business owner, you also need to get a business license. However, most drivers aren’t aware of this requirement or haven’t felt the need to get one since nobody really enforces it, until now.

    doordash

    Uber and Lyft don’t require a business license when you sign up to drive, but some cities like San Francisco are starting to mandate that each rideshare driver get a business license and (of course) pay a fee for it. The process is slowly turning into a privacy nightmare for drivers, and it’s possible that other cities may follow suit since it’s such a large potential source of revenue.

    Today, senior RSG contributor Christian Perea covers how business licenses could become a nightmare for us drivers, and how Uber is actually helping us fight it.

    Uber Fights San Francisco

    Earlier this week the San Francisco Chronicle reported that Uber is going to court to contest a subpoena for drivers’ personal information.

    According to an Uber spokesperson, the SF Treasurer originally requested driver information via a subpoena under the pretext of determining whether or not drivers are independent contractors. Uber complied with the subpoena because they more or less have to. After providing this information, we all got a bill in the mail from the city (mine was north of $600!).

    The City Has Posted Drivers’ Names and Addresses Online

    A search on the city’s website providing the addresses of some Uber drivers in the bay area.

    Part of registering with the SF Treasurer’s Office as a business meant that the business, owner’s name, and address would be entered into the city’s database. Not wanting to run afoul of the law, many drivers just entered their first/last name, and home address. This then became public information on DataSF.org. Now, by simply filtering for “Uber”, “Lyft” or “TNC” anybody is able to pull up lists of drivers.  I could even export all of their data to an excel sheet and send you all my referral codes in the mail!

    Huge Potential For Abuse

    I’m opposed to having my name and address available online since I don’t see any use of listing this information online that would benefit the public. Here are examples of how this data can be abused:

    • The list can be skimmed and turned into a marketing list that targets Uber and Lyft drivers in San Francisco, resulting in a ton of junk mail.
    • Scams/Phishing: Scammers can send “offers” that appear to be from Uber or Lyft that direct you to enter your personal information to qualify.
    • Or fake letters from the IRS requesting bank information for an “audit”
    • A taxi serial-killer can track us all down and murder us.
    • I can go to this site right now, download a giant file of driver names and addresses and send 20,000 Uber drivers my referral code for Lyft 😉
    • And, in all seriousness too, this poses a huge issue for people who don’t want their personal information and address out there for safety reasons. Some people rideshare drive to make extra money and escape bad situations; why would you jeopardize their safety like that for a few bucks?

    In money terms, a highly targeted list of rideshare drivers is gold to any tech company. It’s a list of tech-savvy early adopters who like to make extra money on the side. For a marketer this is a GOLDMINE. For a driver, it’s a breach of privacy and a potential huge annoyance for our mailboxes.

    Personally, I understand SF’s mission to make business data publicly available online for research purposes. However, I think including every single Uber, Lyft, Postmate, etc. doesn’t provide any value to the public because we receive our business through the apps. This is especially true if you think you are actually more of an employee of these companies rather than a small business.

    So it’s hard to argue that anything good comes from making every driver’s information publicly available online. Nobody is going to look us up on DataSF, come knock on our door, and ask for a ride to the airport.

    Imagine Paying $91 For Every City You Pickup A Passenger In…

    Right now, only a limited number of cities require Uber drivers complete a business license to operate. San Francisco charges $91/year. However, some cities like Oakland are considering a business license requirement of each driver as well. So if this becomes the norm throughout multiple cities, the costs to drive will add up quickly.

    The Bay Area provides an example of how difficult this could be, because in the course of a week I am almost guaranteed to end up in San Francisco, Oakland, and San Jose. These cities all could easily require and enforce business licenses and their fees. Other cities in the Bay Area are seeing this new revenue stream and already thinking about how they can “cash in” on drivers.

    If every city (or even a large portion) required that drivers have a business license, it would result in drivers having to pay thousands of dollars to register in every single city they gave rides in throughout the year. For a full-time driver, this can add up fast as you pickup and drop-off passengers throughout your metropolitan area.

    Uber Is Fighting This in Two Ways

    Apart from challenging this in San Francisco, Uber has lobbied for a bill in California (SB 182) that would make it so we only have to register for a business license in one city. It would also have a clause that protects driver’s privacy.

    (f) Personal information submitted to a local jurisdiction pursuant to this chapter shall not be disclosed publicly, including on a publicly accessible Internet Web site.” – Uber Spokesperson
    Uber also sent a petition to drivers asking for a signature to help get SB 182 passed, and I will likely sign it. You can sign it here.
    Lyft also seems to support SB 182. However, they have not challenged San Francisco like Uber has to protect drivers’ information. They are more or less letting Uber foot the lobbying bill, which is smart.
    SB 182 will allow California rideshare drivers to hold one streamlined business license recognized across multiple jurisdictions with predictable costs and reasonable privacy protections. – Lyft Spokesperson

    What Does Uber Have to Gain?

    Uber and Lyft also have a financial and strategic motive in doing this because stacking a large amount of business license fee’s on each driver would prevent most people from driving for Uber. Especially part-time drivers. In the case of San Francisco, TNCs also have an interest in preventing drivers’ information from being posted publicly, because it could lead to poaching or organizing of drivers in any labor dispute.
    It’s good for PR with drivers, too, especially if this were to happen in every major Uber market.

    Could This Benefit Existing Drivers At All?

    It depends. If enough cities were to require this, it would act as a barrier of entry for new drivers. Theoretically meaning that there would be more business, and thus more surge for the drivers who remain and pay all of the business license fees. However, I don’t really see any benefit to drivers by being listed publicly other than possibly making it easier to organize a driver-focused labor movement.

    That’s stretching the “benefits” quite a bit, and personally I see no benefit in paying every business license fee. Overall, my opinion is that it would not benefit existing drivers because any gains seen from having more surge, lower competition, and (maybe) higher fares would eventually be wiped out by a long list of “license fees” from the random cities we drive in.

    Regardless of any unstated motives, I think Uber is helping drivers by fighting this since most of us are opposed to having our personal information listed online. If I drive for a few hours each week, it’s nobody’s business except mine, my passengers, and whichever app I’m using at the time.

    So drivers, do you like the idea of paying $91/year to the city you drive in, and then having them list your name and address online so I can send you my referral cards in the mail? 🙂

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    -Christian @ RSG

    Christian Perea

    Christian Perea

    In 2014, Christian left his job at a mental health center to drive full time for Lyft and Uber. Since then, he has driven for mostly Lyft with a little bit of Sidecar and Postmates thrown in for experimentation and Uber when he doesn't feel like talking to people. He likes to talk about Politics and Economics over a good beer to whoever will listen to him.