Uber's Prop 22 Earnings Guarantee Explained By A Driver

Jarhead2077

New Member
I have seen a couple of threads here in which posters have said that they don't understand Uber's earnings guarantee. So, here it is:

(TL : DR - With its clever mentions of "minimum wage + 20%" and "mileage allowance", the Uber earnings guarantee offer intends to convince drivers and others voting on Prop 22 that it features a robust job-like earnings protection for drivers. However, a closer look reveals that it is, in reality, simply a per-trip earnings guarantee that covers only part of drivers' total work time and mileage expense. It is a woefully inadequate offer which falls way short of the minimum wage + all expenses earnings floor set by AB5)

What is the earnings guarantee?

The earnings guarantee does not replace current rates per mile or rates per minute. What it does is guarantee that drivers will earn 1.2 times the minimum wage plus 30 cents per mile but only from ping acceptance until pax dropoff. So, using SF rates, let's say that you get a ping that is one mile away and the trip length is 5 miles; total distance driven is 6 miles. It takes you 4 minutes to drive to the pax, 3 minutes for the pax to get to the car and 15 minutes to drive the pax to their destination; total time = 22 minutes. Uber would guarantee that the driver would make on this trip:

Mileage: 6 x $0.30 = $1.80
Minimum wage x 1.2 for those 22 minutes: $15 x 1.2 x (22/60) = $6.60
Total guaranteed earnings: $8.40

Now let's see what the trip earnings would be for this trip:

Base fare : $1.60
Miles: 5 x $0.72 (the app only calculates miles with pax on board) = $3.60
Time: 1 minute wait time + 15 minutes' drive = 16 minutes. 16 x $0.31 = $4.96
Total: $1.60 + $3.60 + $4.96 = $10.16

Because $10.16 actual earnings is $1.76 above the $8.40 guarantee, no guarantee payment would be made.

Is this an hourly pay guarantee?

No, it is not. Although the guarantee mentions 1.2 times minimum wage, it only applies while the driver is on route to pick up a pax or has pax on board. This is crucial - because it only applies when the driver is on a trip, it is nothing more than an individual trip earnings guarantee, not a guarantee of hourly earnings for the total time spent working rideshare on a given day.

Why is this guarantee good?

In SF, the app pay rates are (for a 20 percenter) $0.72 per mile and $.31 per minute. The guarantee's rates per mile are $0.30 per mile and ($15 x (1.2 / 60)) = $0.30 per minute. So it's fairly easy to see that the app rates will almost always beat the guarantee - 72 cents per mile is way higher than the 30 cent per mile of the guarantee and $0.31 beats $0.30 per mile. However, the app only pays when the pax is in the car, whereas the guarantee also applies during the drive to the pickup. So, there are situations in which the guarantee would actually pay out, that is, when the drive to the pickup is exceptionally long and the trip length with pax on board is short. However, experienced drivers know that doing these trips (i.e. a 10 mile drive to pickup in order to drive a pax 2 miles) is a total waste of time and should be avoided at all costs. So, for experienced drivers who know what they are doing, this potential benefit of the guarantee would not apply.

Why is this guarantee bad?

First, as already mentioned, this is a trip earnings guarantee; it is not a "shift" earnings guarantee. It does not apply to all of the time worked and it does not apply to all of the miles driven on a shift.

Second, it allows Uber to continue its deprioritisation practice, whereby it sends vastly fewer pings to drivers who it considers aren't accepting enough pings. That would be you, all you cherry pickers out there. If Uber chooses not to give a driver any trips or very few trips then the driver will earn very little and the guarantee will not pay.

Third, the guarantee mentions that it is calculated over a two week basis. This means that if your earnings were to exceed the guarantee on one trip, as in the above example where the actual earnings exceeded the guarantee by $1.76, but on the next trip the actual earnings were, for example, $1.50 below the earnings guarantee, the driver wouldn't get any guarantee payment for the second trip! The reason is that $1.76 - $1.50 = $0.26. The total earnings of the driver for both trips would still be 26 cents above the guarantee amount, meaning no extra pay, even though the second trip was below guarantee. It's easy to see that, over all of the trips done by a driver in a two week period, the trips in which the driver did not beat the earnings guarantee will be "compensated for" by the higher paying trips that the driver did within the period. This means, in effect, that the driver's own earnings from those higher paying trips will be used to cover the earnings guarantee for the lower paying trips, instead of it being paid by Uber.

Why does Uber choose a two week period over which to evaluate drivers' earnings for the guarantee instead of just using the normal one week pay period? Because the longer the period, the more it benefits Uber and the more it detriments drivers - a two week trip analysis period means a higher chance that a driver will accrue higher paying trips which would raise his/her average while-on-trip earnings, and therefore a lower chance that Uber will have to actually pay the guarantee. Uber now trumpets that it wants to do right by drivers. If it wanted to, it could calculate the earnings guarantee after the completion of each trip. This would give drivers maximum earnings protection under it. But evidently Uber does not want to do that, preferring to build the minimum payment possible into the design of the guarantee.

Overall, this guarantee is stacked heavily in Uber's favour and gives drivers virtually nothing while allowing Uber to maintain its control over drivers at almost no additional cost to itself.

Uber's offer in the driver app mentions an hourly guarantee example of $23.10/hr in Los Angeles. Is this smoke and mirrors?

Yes. Uber's example covers only the hours spent driving to the pax and with pax on board. We generally are on a trip about 50% of the total time we drive rideshare. This means that, in order to drive the 20 hours on-trip time in Uber's example, we would have been in the car for around 40 hours total, meaning that Uber's guarantee is actually worth $11.55 per hour, which is less that the $13/hr minimum wage in Los Angeles. And that's before the driver pays for gas, car maintenance and all the other expenses.

Why in the world would you want a “Guarantee “ Income/wage? I have never known an independent worker/business person who ever received a guaranteed wage or income or insurance. If you want that you should quit the platform and go to work for someone else. Don’t screw up this platform where you can work when you wish for an long as you wish or not as you wish. I personally find this Platform to have excellent Earning capabilities and I have been in business for myself for over 35 Years. The only problem is with the software determining directions for a trip and that is usually because of local growth and updating the gps system.
 

AB5

Active Member
I have seen a couple of threads here in which posters have said that they don't understand Uber's earnings guarantee. So, here it is:

(TL : DR - With its clever mentions of "minimum wage + 20%" and "mileage allowance", the Uber earnings guarantee offer intends to convince drivers and others voting on Prop 22 that it features a robust job-like earnings protection for drivers. However, a closer look reveals that it is, in reality, simply a per-trip earnings guarantee that covers only part of drivers' total work time and mileage expense. It is a woefully inadequate offer which falls way short of the minimum wage + all expenses earnings floor set by AB5)

What is the earnings guarantee?

The earnings guarantee does not replace current rates per mile or rates per minute. What it does is guarantee that drivers will earn 1.2 times the minimum wage plus 30 cents per mile but only from ping acceptance until pax dropoff. So, using SF rates, let's say that you get a ping that is one mile away and the trip length is 5 miles; total distance driven is 6 miles. It takes you 4 minutes to drive to the pax, 3 minutes for the pax to get to the car and 15 minutes to drive the pax to their destination; total time = 22 minutes. Uber would guarantee that the driver would make on this trip:

Mileage: 6 x $0.30 = $1.80
Minimum wage x 1.2 for those 22 minutes: $15 x 1.2 x (22/60) = $6.60
Total guaranteed earnings: $8.40

Now let's see what the trip earnings would be for this trip:

Base fare : $1.60
Miles: 5 x $0.72 (the app only calculates miles with pax on board) = $3.60
Time: 1 minute wait time + 15 minutes' drive = 16 minutes. 16 x $0.31 = $4.96
Total: $1.60 + $3.60 + $4.96 = $10.16

Because $10.16 actual earnings is $1.76 above the $8.40 guarantee, no guarantee payment would be made.

Is this an hourly pay guarantee?

No, it is not. Although the guarantee mentions 1.2 times minimum wage, it only applies while the driver is on route to pick up a pax or has pax on board. This is crucial - because it only applies when the driver is on a trip, it is nothing more than an individual trip earnings guarantee, not a guarantee of hourly earnings for the total time spent working rideshare on a given day.

Why is this guarantee good?

In SF, the app pay rates are (for a 20 percenter) $0.72 per mile and $.31 per minute. The guarantee's rates per mile are $0.30 per mile and ($15 x (1.2 / 60)) = $0.30 per minute. So it's fairly easy to see that the app rates will almost always beat the guarantee - 72 cents per mile is way higher than the 30 cent per mile of the guarantee and $0.31 beats $0.30 per mile. However, the app only pays when the pax is in the car, whereas the guarantee also applies during the drive to the pickup. So, there are situations in which the guarantee would actually pay out, that is, when the drive to the pickup is exceptionally long and the trip length with pax on board is short. However, experienced drivers know that doing these trips (i.e. a 10 mile drive to pickup in order to drive a pax 2 miles) is a total waste of time and should be avoided at all costs. So, for experienced drivers who know what they are doing, this potential benefit of the guarantee would not apply.

Why is this guarantee bad?

First, as already mentioned, this is a trip earnings guarantee; it is not a "shift" earnings guarantee. It does not apply to all of the time worked and it does not apply to all of the miles driven on a shift.

Second, it allows Uber to continue its deprioritisation practice, whereby it sends vastly fewer pings to drivers who it considers aren't accepting enough pings. That would be you, all you cherry pickers out there. If Uber chooses not to give a driver any trips or very few trips then the driver will earn very little and the guarantee will not pay.

Third, the guarantee mentions that it is calculated over a two week basis. This means that if your earnings were to exceed the guarantee on one trip, as in the above example where the actual earnings exceeded the guarantee by $1.76, but on the next trip the actual earnings were, for example, $1.50 below the earnings guarantee, the driver wouldn't get any guarantee payment for the second trip! The reason is that $1.76 - $1.50 = $0.26. The total earnings of the driver for both trips would still be 26 cents above the guarantee amount, meaning no extra pay, even though the second trip was below guarantee. It's easy to see that, over all of the trips done by a driver in a two week period, the trips in which the driver did not beat the earnings guarantee will be "compensated for" by the higher paying trips that the driver did within the period. This means, in effect, that the driver's own earnings from those higher paying trips will be used to cover the earnings guarantee for the lower paying trips, instead of it being paid by Uber.

Why does Uber choose a two week period over which to evaluate drivers' earnings for the guarantee instead of just using the normal one week pay period? Because the longer the period, the more it benefits Uber and the more it detriments drivers - a two week trip analysis period means a higher chance that a driver will accrue higher paying trips which would raise his/her average while-on-trip earnings, and therefore a lower chance that Uber will have to actually pay the guarantee. Uber now trumpets that it wants to do right by drivers. If it wanted to, it could calculate the earnings guarantee after the completion of each trip. This would give drivers maximum earnings protection under it. But evidently Uber does not want to do that, preferring to build the minimum payment possible into the design of the guarantee.

Overall, this guarantee is stacked heavily in Uber's favour and gives drivers virtually nothing while allowing Uber to maintain its control over drivers at almost no additional cost to itself.

Uber's offer in the driver app mentions an hourly guarantee example of $23.10/hr in Los Angeles. Is this smoke and mirrors?

Yes. Uber's example covers only the hours spent driving to the pax and with pax on board. We generally are on a trip about 50% of the total time we drive rideshare. This means that, in order to drive the 20 hours on-trip time in Uber's example, we would have been in the car for around 40 hours total, meaning that Uber's guarantee is actually worth $11.55 per hour, which is less that the $13/hr minimum wage in Los Angeles. And that's before the driver pays for gas, car maintenance and all the other expenses.
No on Prop 22
Post automatically merged:

Agreed; business people should not get a guaranteed wage or income or insurance. However, as rideshare drivers we are employees; we are not in business.
Y22 We are Employees
 

BoboBig

Well-Known Member
I have seen a couple of threads here in which posters have said that they don't understand Uber's earnings guarantee. So, here it is:

(TL : DR - With its clever mentions of "minimum wage + 20%" and "mileage allowance", the Uber earnings guarantee offer intends to convince drivers and others voting on Prop 22 that it features a robust job-like earnings protection for drivers. However, a closer look reveals that it is, in reality, simply a per-trip earnings guarantee that covers only part of drivers' total work time and mileage expense. It is a woefully inadequate offer which falls way short of the minimum wage + all expenses earnings floor set by AB5)

What is the earnings guarantee?

The earnings guarantee does not replace current rates per mile or rates per minute. What it does is guarantee that drivers will earn 1.2 times the minimum wage plus 30 cents per mile but only from ping acceptance until pax dropoff. So, using SF rates, let's say that you get a ping that is one mile away and the trip length is 5 miles; total distance driven is 6 miles. It takes you 4 minutes to drive to the pax, 3 minutes for the pax to get to the car and 15 minutes to drive the pax to their destination; total time = 22 minutes. Uber would guarantee that the driver would make on this trip:

Mileage: 6 x $0.30 = $1.80
Minimum wage x 1.2 for those 22 minutes: $15 x 1.2 x (22/60) = $6.60
Total guaranteed earnings: $8.40

Now let's see what the trip earnings would be for this trip:

Base fare : $1.60
Miles: 5 x $0.72 (the app only calculates miles with pax on board) = $3.60
Time: 1 minute wait time + 15 minutes' drive = 16 minutes. 16 x $0.31 = $4.96
Total: $1.60 + $3.60 + $4.96 = $10.16

Because $10.16 actual earnings is $1.76 above the $8.40 guarantee, no guarantee payment would be made.

Is this an hourly pay guarantee?

No, it is not. Although the guarantee mentions 1.2 times minimum wage, it only applies while the driver is on route to pick up a pax or has pax on board. This is crucial - because it only applies when the driver is on a trip, it is nothing more than an individual trip earnings guarantee, not a guarantee of hourly earnings for the total time spent working rideshare on a given day.

Why is this guarantee good?

In SF, the app pay rates are (for a 20 percenter) $0.72 per mile and $.31 per minute. The guarantee's rates per mile are $0.30 per mile and ($15 x (1.2 / 60)) = $0.30 per minute. So it's fairly easy to see that the app rates will almost always beat the guarantee - 72 cents per mile is way higher than the 30 cent per mile of the guarantee and $0.31 beats $0.30 per mile. However, the app only pays when the pax is in the car, whereas the guarantee also applies during the drive to the pickup. So, there are situations in which the guarantee would actually pay out, that is, when the drive to the pickup is exceptionally long and the trip length with pax on board is short. However, experienced drivers know that doing these trips (i.e. a 10 mile drive to pickup in order to drive a pax 2 miles) is a total waste of time and should be avoided at all costs. So, for experienced drivers who know what they are doing, this potential benefit of the guarantee would not apply.

Why is this guarantee bad?

First, as already mentioned, this is a trip earnings guarantee; it is not a "shift" earnings guarantee. It does not apply to all of the time worked and it does not apply to all of the miles driven on a shift.

Second, it allows Uber to continue its deprioritisation practice, whereby it sends vastly fewer pings to drivers who it considers aren't accepting enough pings. That would be you, all you cherry pickers out there. If Uber chooses not to give a driver any trips or very few trips then the driver will earn very little and the guarantee will not pay.

Third, the guarantee mentions that it is calculated over a two week basis. This means that if your earnings were to exceed the guarantee on one trip, as in the above example where the actual earnings exceeded the guarantee by $1.76, but on the next trip the actual earnings were, for example, $1.50 below the earnings guarantee, the driver wouldn't get any guarantee payment for the second trip! The reason is that $1.76 - $1.50 = $0.26. The total earnings of the driver for both trips would still be 26 cents above the guarantee amount, meaning no extra pay, even though the second trip was below guarantee. It's easy to see that, over all of the trips done by a driver in a two week period, the trips in which the driver did not beat the earnings guarantee will be "compensated for" by the higher paying trips that the driver did within the period. This means, in effect, that the driver's own earnings from those higher paying trips will be used to cover the earnings guarantee for the lower paying trips, instead of it being paid by Uber.

Why does Uber choose a two week period over which to evaluate drivers' earnings for the guarantee instead of just using the normal one week pay period? Because the longer the period, the more it benefits Uber and the more it detriments drivers - a two week trip analysis period means a higher chance that a driver will accrue higher paying trips which would raise his/her average while-on-trip earnings, and therefore a lower chance that Uber will have to actually pay the guarantee. Uber now trumpets that it wants to do right by drivers. If it wanted to, it could calculate the earnings guarantee after the completion of each trip. This would give drivers maximum earnings protection under it. But evidently Uber does not want to do that, preferring to build the minimum payment possible into the design of the guarantee.

Overall, this guarantee is stacked heavily in Uber's favour and gives drivers virtually nothing while allowing Uber to maintain its control over drivers at almost no additional cost to itself.

Uber's offer in the driver app mentions an hourly guarantee example of $23.10/hr in Los Angeles. Is this smoke and mirrors?

Yes. Uber's example covers only the hours spent driving to the pax and with pax on board. We generally are on a trip about 50% of the total time we drive rideshare. This means that, in order to drive the 20 hours on-trip time in Uber's example, we would have been in the car for around 40 hours total, meaning that Uber's guarantee is actually worth $11.55 per hour, which is less that the $13/hr minimum wage in Los Angeles. And that's before the driver pays for gas, car maintenance and all the other expenses.

I don’t think Uber is providing the guarantee to somehow substantially increase our pay it’s more of showing the California Government and Boards this safety net so that Uber will not have to proceed with having to classify drivers as employees and have to restructure their entire business model.
 

The Gift of Fish

Well-Known Member
I don’t think Uber is providing the guarantee to somehow substantially increase our pay it’s more of showing the California Government and Boards this safety net so that Uber will not have to proceed with having to classify drivers as employees and have to restructure their entire business model.
That is an accurate summary of Prop22.
 

Nats121

Well-Known Member
I don’t think Uber is providing the guarantee to somehow substantially increase our pay it’s more of showing the California Government and Boards this safety net so that Uber will not have to proceed with having to classify drivers as employees and have to restructure their entire business model.
Prop 22 has no safety net.

A safety net would provide a guaranteed wage whether or not there were any trips.

With Prop 22, no trips = no pay.
 

Deadmiler69

Well-Known Member
Prop 22 has no safety net.

A safety net would provide a guaranteed wage whether or not there were any trips.

With Prop 22, no trips = no pay.
That is so that you can maintain the freedom of declining any and all trips offered to you. If you want 90-95% acceptance rates to return, I’m sure Uber will gladly pay you for the whole hour. Enjoy your 20 mile pickups!!!!
 

Nats121

Well-Known Member
That is so that you can maintain the freedom of declining any and all trips offered to you. If you want 90-95% acceptance rates to return, I’m sure Uber will gladly pay you for the whole hour. Enjoy your 20 mile pickups!!!!
My post wasn't a statement of what I want, it's a statement of fact.
 

Nats121

Well-Known Member
That is so that you can maintain the freedom of declining any and all trips offered to you.
Uber undermines that "freedom" via time-outs and/or "deprioritization". Both of those measures penalize the drivers by cutting their earnings.
 

Deadmiler69

Well-Known Member
Uber undermines that "freedom" via time-outs and/or "deprioritization". Both of those measures penalize the drivers by cutting their earnings.
Cuts into their earnings? What earnings if they are declining any ride not within 5 minutes that isn’t going too long or too far and has the appropriate amount of surge?
 

Nats121

Well-Known Member
Cuts into their earnings? What earnings if they are declining any ride not within 5 minutes that isn’t going too long or too far and has the appropriate amount of surge?
A driver has to be online to make money, so any form of timeout means zero chance of making money.

Uber has the power to starve or feed any driver they choose, which means they can punish "choosy" drivers by sending the short pickup rides to the "cooperative" drivers (ants).
 

Stevie The magic Unicorn

Well-Known Member
That is so that you can maintain the freedom of declining any and all trips offered to you. If you want 90-95% acceptance rates to return, I’m sure Uber will gladly pay you for the whole hour. Enjoy your 20 mile pickups!!!!

If Uber paid me 57.5c a mile to drive out to a passenger plus min wage for all time logged on I would gladly sit out in the hood and chase min trips from 6 miles 15 minutes away all day long.
 

Deadmiler69

Well-Known Member
If Uber paid me 57.5c a mile to drive out to a passenger plus min wage for all time logged on I would gladly sit out in the hood and chase min trips from 6 miles 15 minutes away all day long.
You won’t get 57.5 cents per mile and you won’t get to “chase” anything. You would need to take 90-95% of the rides offered to you in order to keep your job.
 

Deadmiler69

Well-Known Member
sorry, as an employee or an IC? As an employee the whole concept of 'pings' goes away. They become dispatch orders: you get, you go. No go, you fired.
As an employee. I was being generous by assuming that there would be a couple exceptions to accepting 100%. I fully expect it to be as you say. If you don’t accept you don’t work.
 

SHalester

Well-Known Member
would be a couple exceptions to accepting 100%.
I'm guessing the reasons to 'cancel' are going to shrink to maybe a couple if we are made to be employees. Unsafe pickup, no show....

Pings, tho, we'd have to accept every single one, because (wait for it) we'd be employees with no options to decline.
 
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