Define your terms
A closer look at HB 2076
Hello and welcome to Oversharing, a newsletter about the proverbial sharing economy. If you’re returning from last time, thanks! If you’re new, nice to have you! (Over)share the love and tell your friends to sign up here.
In case you missed it: Oversharing is now a subscriber-supported newsletter. Paid subscribers get three posts per week, exclusive access to comments and participation in community threads, and access to the full Oversharing archive. Subscribe now for a special launch period rate of $7/month or $70/year.
We talked yesterday about HB 2076, the new law in Washington state that guarantees ride-hail drivers a minimum wage and a handful of other benefits like paid sick leave. One thing I found particularly interesting while reading the bill was all the terms it had to define at the very beginning, for instance: ‘compensation,’ ‘dispatch platform time,’ and ‘passenger platform miles.’
Defining key terms is standard practice in contracts, and some of these might seem simple or obvious. But having the definitions is a big deal. One reason the labor and compensation policies of gig companies have been so difficult to pin down in the past is because these concepts weren’t always clear, at least in the public discourse, which made it hard to have an informed discussion. The definitions in HB 2076 provide that clarity and are crucial to the conversation about how to pay ride-hail drivers. Below I’ve highlighted some of the most important ones (all emphasis added/mine):
Compensation
"Compensation" means payment owed to a driver by reason of providing network services including, but not limited to, the minimum payment for passenger platform time and mileage, incentives, and tips.
Simple but essential. Past analyses of Uber driver wages have been inconsistent on what components of compensation they consider (for instance, some include incentive pay and others don’t). Just as any worker would want to know the various parts of their compensation package, it’s helpful to clarify what counts for ride-hail drivers.
Dispatch platform time
"Dispatch platform time" means the time a driver spends traveling from a dispatch location to a passenger pick-up location. Dispatch platform time ends when a passenger cancels a trip or the driver begins the trip through the driver platform. A driver cannot simultaneously be engaged in dispatch platform time and passenger platform time for the same transportation network company. For shared rides, dispatch platform time means the time a driver spends traveling from the first dispatch location to the first passenger pick-up location.
When it comes to driver pay, it’s helpful to think about the different portions of a trip. There’s the time a driver is active on the app waiting for a ride; the time between when the driver accepts the trip and picks up the passenger; and the time when the driver has the passenger in their car. Drivers get paid for each trip, but they are not actually ‘on a trip’ all of the time. A key question in driver compensation is whether ride-hail firms should bear some responsibility for the time drivers spend active on apps but without a job. The pay floor for drivers in New York City thought yes, and handled this by incorporating a utilization rate into its wage formula. Whether you agree with that approach or not, you can only even start to talk about it once you understand and name the different segments of a trip, like ‘dispatch platform time.’
Passenger platform time
"Passenger platform time" means the period of time when the driver is transporting one or more passengers on a trip. For shared rides, passenger platform time means the period of time commencing when the first passenger enters the driver's vehicle until the time when the last passenger exits the driver's vehicle.
Again, we define a key trip segment, this time the one where the passenger is in the car. What I like most about this definition is that it also clarifies how the time works for shared rides in which multiple passengers might overlap but with different start and end points.
Passenger platform miles
"Passenger platform miles" means all miles driven during passenger platform time as recorded in a transportation network company's driver platform.
Similar to above, but this time counting miles and not minutes with a passenger in the car.
Transportation network company
"Transportation network company" has the same meaning as defined in RCW 46.04.652. A transportation network company does not provide for hire transportation service.
A classic! Transportation network companies (TNCs) don’t provide for-hire transportation services, of course not, they are simply platforms connecting people interested in providing a ride for a fee (drivers/workers) with people interested in purchasing a ride (riders/customers). This one has been around since the dawn of Uber and I love that even now, when Uber is a global leader in mobility, a company that has “revolutionized the way the world moves” (as Uber mobility chief Andrew Macdonald said at the company’s investor day in February), a company that believes taxis—taxis!—might be the future, we are still using that old line that ‘transportation network companies’ do not do that one thing of providing for-hire transportation service.