To ease the concerns of the public and lawmakers, Uber and Lyft have deployed stricter background checks for their drivers.
What they did not see coming was that the new background checks resulted in thousands of drivers being denied to operate.
Several states have been combating ride-sharing programs.
In January 2017, Massachusetts set a law that required all ride-sharing companies to submit two background checks to the state when hiring new drivers. These background checks included the company’s proprietary check and the state background check.
Approximately 70,789 applications were sent in, and over 8,000 were denied for licenses. This equates to over 11% of the applicant pool rejected.
The biggest rejection cause was a driver’s license status. A shocking number of candidates working for ride-share companies had suspended driver’s licenses or had minimal experience on the road.
There were also hundreds rejected for serious criminal offenses — including sexual and violent crimes. Out of the 70,000 applications, 51 were registered sex offenders. Some other criminal offenses included drunken driving convictions.
Uber and Lyft have private companies conducting background screenings, but those companies search a maximum of seven years in the past. Therefore, numerous offenses were missed.
Both ride-sharing services reacted angrily to the state’s denials and argued it was unfair to hold back drivers. Uber and Lyft both feel that the new background requirements punish those trying to get back on their feet.
Ride-sharing companies stated that they have limitations on how far they can examine criminal records, while the state does not have the same restrictions as commercial providers. The extensive background checks from the state were what found most the offenses.
Judge Blocks Union Requests
In Washington, a first-time law was passed to allow for-hire drivers to unionize. The law specifically addressed drivers from services like Uber and Lyft.
However, the U.S. Chamber of Commerce requested from the federal courts that the law be placed on hold. They argued that independent contractors, if granted union status, would be able to bargain over fares.
Unionization among ride-sharing programs is the center of numerous debates. Their business models are under scrutiny, especially from taxi companies and local governments. Furthermore, there has been the issue of unqualified drivers operating vehicles.
Both companies have had issues with lawsuits and injury claims in the past, only complicating their business further.
The federal judge that blocked the unionization request made it clear it was temporary.
There is no indication that the Chamber of Commerce will win their argument against the law. However, the city’s law would disrupt companies operating in the city. Also, drivers using ride-sharing to earn extra money might lose flexibility if unionized.
A union would dictate the number of hours, how long a person drives, and more, which would complicate the process of ordering a ride-share vehicle.
The only reason the Chamber has succeeded so far is their argument. The Chamber argued that the law turns independent contractors into employees and allows independent workers to fix prices instead of the company offering the service.
Regardless of the decision, Uber and Lyft will have to strategize to improve their business practices.