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For those that complain about Uber's cut.

jazzapt

Well-Known Member
I wish this site offered posts that were stickys (sp?). Meaning it could/would be placed at the top of any forum page so that readers would always see it. I think this would be a valuable post for everyone to read before they post to complain about how much a percentage Uber is taking from the fare.

The complaint usually along the lines of “I can’t believe Uber is taking 55%! I thought it would be 25%. Uber is ripping us off!”. At risk of sounding like a shill, no matter how much Uber receives from the fare, unless there is a specific issue with that fare, they are always paying you exactly the way you agreed for them to pay you.

Let me explain. In every market there has always been a posted per mile/minute fare. Currently, in my market (Boston) its $1.35 per mile/$0.21 per minute. Depending on when you started driving for Uber, they either take 20% or 25% of that mile/min fare for commission. In my case, it’s 20%. Therefore I get paid $1.08 per mile and $0.168 per minute (minus fees). If I was at 25% it would be $1.0125 mile/$0.1575 per minute (minus fees). The only way I will ever get paid more is if there is surge/boost (multiply those mile/min numbers by the surge/boost multipliers) or through incentives. Other than the lower fares, this is how I have always been paid in the 3+ years since I’ve been doing this.

Therefore, those are the only numbers I review when looking at my fare. And as long as I get paid correctly based on route and multipliers, I move on because it is all I can and should expect.

I do not spend much time worrying about how much the rider spent. Because ,quite frankly, they are the ones getting ripped off. The upfront fares they pay SHOULD be based off of the per mile/min rate in that market, just as my pay does. But since Uber does not break down how they determined the upfront price, they can and usually do charge above and beyond the what the mile/min rate (plus advertised fees) should be for the ride. And all the difference all goes into Uber’s pocket. But the riders either don’t realize they are being ripped off, or they don’t care. So to me, that is on them.

Is short, as always, we drivers get paid 75% or 80% of the market fares (minus fees), not 75% to 80% of what the rider pays. If that bugs you, the best way to fight it is to let pax know they are being ripped off and how to beat it, or long haul when you can to reduce Uber’s cut.
 

reg barclay

Well-Known Member
Moderator
What annoys us about that is that while Uber keeps giving itself raises, it keeps giving us pay cuts.
I agree with you that rates in many places are too low. However as far as actual 'cuts' are concerned, (I don't know about your market but) where I drive there haven't been any cuts since the infamous cuts of Jan 2016. In fact rates in NJ have inched back up a few times since then (albeit not by a massive amount).
 
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jazzapt

Well-Known Member
What annoys us about that is that while Uber keeps giving itself raises, it keeps giving up pay cuts.
Completely agree. And that is worth about. But this is more related to those who still look at their fares and expect to see that they are getting paid 75% of what pax paid.

I agree with you that rates in many places are too low. However as far as actual 'cuts' are concerned, (I don't know about your market but) where I drive there haven't been any cuts since the infamous cuts of Jan 2016. In fact rates in NJ have inched back up a few times since then (albeit not by a massive amount).
Ditto. However there are other ways they work to reduce driver pay (like suppressing surge) that is worth getting worked up about. But the pay process has not changed one bit.
 
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Cableguynoe

Well-Known Member
let pax know they are being ripped off
Everything you said pretty much became worthless to me after I read that.

Just like you said drivers are getting paid what they agreed to, riders are getting charged what they agreed to.

I bet if you get a nice 3.5x surge ride for 45+ minutes, you won't be too quick to let them know they are being ripped off and should only be paying $1.35 a mile, not $4 a mile.

Riders are NOT being ripped off.

They're getting great deals.
 

jazzapt

Well-Known Member
Everything you said pretty much became worthless to me after I read that.

Just like you said drivers are getting paid what they agreed to, riders are getting charged what they agreed to.

I bet if you get a nice 3.5x surge ride for 45+ minutes, you won't be too quick to let them know they are being ripped off and should only be paying $1.35 a mile, not $4 a mile.

Riders are NOT being ripped off.

They're getting great deals.
When I open the Uber app as a Pax and put in destination, I get up upfront fare. On that upfront fare is an “Info” icon. If I click on it, it gives a breakdown of the charges that SHOULD determine my fare.

info.JPG


fare.JPG


I have calculated this trip many times. On every occasion calculating current time and distance using all reasonable routes from Google Maps and Waze, the upfront price is anywhere between $4 to $13 more than it should be based on these numbers. But there is no way to figure out where that extra $4-$13 is coming from. (It's not surge because it never surges here). Maybe pax aren't getting ripped off, but they are being over-charged.


And in your scenario, I wouldn't say a damned thing became I don’t care that they are being over charged. As long as I am paid correctly, that's all that matters to me. I just mentioned it as an option a driver could use if they are upset how by how much pax paid compared to how much they are getting paid.
 
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Another Uber Driver

Well-Known Member
Moderator
I agree with you that rates in many places are too low. However as far as actual 'cuts' are concerned, (I don't know about your market but) where I drive there haven't been any cuts since the infamous cuts of Jan 2016. In fact rates in NJ have inched back up a few times since then (albeit not by a massive amount).
There have not been any here, since then, either. There were several between August, 2014 and January, 2016. Other drivers with longer tenure than mine have told me of more before that.

There has been no increase in payouts to drivers, here. There have been bonuses and other incentives, but no increase in base rates.
 

jazzapt

Well-Known Member
How are riders getting ripped off? There’s a reason rideshare is so popular is because it gives people an affordable means a transportation.
Again, maybe a poor choice of words on my part (I was trying to play it off my statement about driver's claiming we are being ripped-off when they see Uber taking 55% of rider payment, seems I didn't sell it well). What I really meant is that riders are over-paying when compared to advertised rates. This is the cause of why Uber takes such a big cut, not because they are ripping off drivers.
 

KevinH

Well-Known Member
Many of the drivers that signed up a couple of years ago were presented an pay agreement that was based on rate, a single rate. Since then Uber has changed their business practice to uses two rate schemes, one for the passenger and one for the driver. This difference was initially implemented without being addressed in a new driver agreement. That issue is the basis of current driver law suit that covers the period between the earliest implementation of the two scale system and the subsequent revision of the driver agreement.
Uber is also under federal investigation regarding "Transparent Pricing" violations when it became apparent that Uber was charging some customers more than others for the same time and distance. It was revealed last fall that customers from better neighborhoods or heavy spenders were getting a bit of a "bump" in their charges.
 

Gilby

Well-Known Member
As a long-time manager who has hired hundreds of people over many years, and has done even more hundreds of performance reviews and pay reviews, in my opinion (as an employee in addition to being an employer) there is just one fundamental question:

Do you feel fairly compensated for the work that you do?

All the other things - how much the company profits from your work, how your pay compares to others doing similar work, etc., etc. - doesn't really matter.
 

henrygates

Well-Known Member
As a long-time manager who has hired hundreds of people over many years, and has done even more hundreds of performance reviews and pay reviews, in my opinion (as an employee in addition to being an employer) there is just one fundamental question:

Do you feel fairly compensated for the work that you do?

All the other things - how much the company profits from your work, how your pay compares to others doing similar work, etc., etc. - doesn't really matter.
No.
 

jazzapt

Well-Known Member
As a long-time manager who has hired hundreds of people over many years, and has done even more hundreds of performance reviews and pay reviews, in my opinion (as an employee in addition to being an employer) there is just one fundamental question:

Do you feel fairly compensated for the work that you do?

All the other things - how much the company profits from your work, how your pay compares to others doing similar work, etc., etc. - doesn't really matter.
I can't possibly imagine there is a driver on here that would answer yes to that question (except for maybe the rare driver who does this for fun or thinks of this as a way provide some kind of community service or something)

On a macro level, what I think can be reasoned here (with no argument from me) is if Uber can over-charge pax compared to advertised rates, and pax have no problem being over-charged, shouldn't the drivers be in on some of that additional revenue seeing everything we bring to the table? I'd be willing to bet you'd have a hard time finding anyone here that would say no.

But my main point of this post was to dispel the notion that Uber is somehow taking a larger part of the driver's pie than was agreed to. I know approximately how much much I will make on each ride by looking at the miles and ETA on the GPS. How much the rider agreed to pay for that same trip is inconsequential to me on a micro level.
 

superdupersecret

New Member
On a macro level, what I think can be reasoned here (with no argument from me) is if Uber can over-charge pax compared to advertised rates, and pax have no problem being over-charged
If the rider is agreeing to the up-front pricing, then they are not being "over-charged". The term overcharged would apply if they agreed to one price, but were charged something different. The reason for the difference (as you imply it from the advertised rates) is simply a "fudge factor". Uber is basically guaranteeing the price of the ride (the "up front fare"), so the pax knows exactly what he will be charged, and not have to worry about the tally running up while the ride is going. The "fudge" factor is to account for things that might make the ride cost more to Uber, like additional traffic or accidents that it can't account for.

Really, it's the best (least-worst?) compromise for all involved (Pax/Driver/Uber).

1. Pax knows what they are paying up front. If they don't like the fare, they won't take it. This is why surge comes and goes so fast: lots of riders see the price, then bail because they don't want to pay it.
2. Driver gets paid exactly what they agreed to: by the mile/minute. This is to your original point.
3. Uber reduces their losses when the route changes. The upfront pricing is just a guess. So they add in additional slack to cover the unknown. Sometimes it works out for them, sometimes it doesn't.
 

Fauxknight

Well-Known Member
I agree with you that rates in many places are too low. However as far as actual 'cuts' are concerned, (I don't know about your market but) where I drive there haven't been any cuts since the infamous cuts of Jan 2016. In fact rates in NJ have inched back up a few times since then (albeit not by a massive amount).
Same here, but Uber keeps working on how to get more from a ride w/o giving us a cut of it. Higher booking fee and upfront pricing are just two examples of this.
 
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