New York City Moves Toward Requiring Uber Tipping Option

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The New York City Taxi and Limousine Commission said on Monday that it plans to propose a rule no later than July that would require all for-hire vehicles to allow passengers to tip drivers using the same method they use to pay for the ride.

Ride-services company Uber Technologies Inc may be required to provide passengers a way to tip their drivers, despite its longstanding resistance, if a plan by New York City's taxi regulator is implemented. From the beginning, Uber's promotional materials have touted its rates as more than making up for the lack of tips, but Tavares, the Guild driver, said that's not the case.

Lyft, Uber's rival ride-sharing app, now has a tipping system and, in March, the company said their drivers made more than $2 million in tips nationwide.

The proposal follows a petition from the Independent Drivers Guild, a union-style association of drivers recognized by Uber, The New York Times reports. "My hope is that drivers in other cities across the country will come together" to demand better treatment from Uber.

The court passed the order after the two companies informed it that efforts to settle dispute with the two unions - the Sarvodaya Driver Association of Delhi (SDAD) and the Rajdhani Tourist Drivers' Union - through mediation had failed.

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Adding a tipping feature to Uber's app would remove one significant difference between Uber and its chief USA competitor, Lyft.

Today's decision is a vitally important step forward for drivers. And of course, people who ride in taxis can tip with their credit cards or cash. As a result, New York City's professional drivers have traditionally depended on gratuities for a substantial portion of their income. It relieves customers of the pressures of doing the math on a tip - especially in front of others - and helps them avoid what psychologists call the "pain of paying" when they don't have to rifle through their wallet to leave a cash tip, says Nir Eyal, author of "Hooked: How to Build Habit-Forming Products" and a researcher on consumer behaviors. "Cuts to driver pay across the ride-hail industry has made tipping income more important than ever", said Conigliaro in a statement.

Uber spokeswoman Alix Anfang said the company will review the proposed rule once it's drafted. At that point, a final rule is posted and then voted on by the TLC board of commissioners.

The city agency characterized the tipping proposal as part of an initiative to address drivers' economic challenges.

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