Gig drivers in Colorado are leaving ride-hailing platforms Uber and Lyft to form a new ride ride-share app, Westword reported.
By establishing their own co-op, ride-share drivers in Colorado are speaking out against the lack of transparency and control that ride-sharing companies like Uber and Lyft have over their wages.
Colorado Independent Drivers United is a union that represents drivers for ride-sharing services, delivery services, pedicabs, taxis and limousines. Drivers are requesting improved working conditions, increased transparency regarding employment offers and an end to drivers being deactivated without any explanation.
With support from the Rocky Mountain Employee Ownership Center (RMEOC), the newly formed drivers' co-op will be controlled and run by the drivers themselves. The purpose of the co-op is to give employees the ability to decide for themselves matters pertaining to management, pay and transparency. It will be the first employee-owned ride-sharing company in Colorado, and if the co-op meets its membership goal of 2,000 drivers, it will be the biggest worker cooperative in the state. If the co-op achieves its goal, it will also be the first employee-owned ride-sharing company in the United States.
According to Minsun Ji, executive director of RMEOC, drivers are "desperate right now" because of the poor commissions they receive from Uber and Lyft.
There was a time when commission rates could reach as high as 65%, but now they can drop as low as 25%. Ji has high expectations that the co-op will empower drivers to take more charge of their professional lives and their destinies.
In order to become members of the cooperative, drivers are required to pay a one-time buy-in charge of $100 and go through an orientation to ensure that drivers comprehend the organizational hierarchy of the business, as well as the responsibilities that come with having a stake in the business.
The co-op, in contrast to Lyft and Uber, will keep only 20% of the profit made from each trip, while the drivers will be responsible for the remaining 80%. The profit made by the co-op will be put toward paying employees and covering operational expenses. Ji notes that the co-op will provide opportunities for people who may not have as many choices for work, such as immigrants. Westword reported that immigrants make up 75% of Uber's driving population in Denver.
The RMEOC will provide drivers with assistance in generating capital, education on how to operate an employee-owned business and advocacy for legislative changes that will assist the company. A board of directors, which will be elected from within the ranks of the employees, will be in charge of running the co-op and will have the ability to hire specialists in finance, management and other fields as required.
In New York City, a drivers' co-op launched in 2021, and Denver will be the second city to launch the model. The New York co-op, which initially only provided pre-planned journeys for non-urgent medical appointments, has since expanded its services to include ride-sharing on demand. Since it first began operations, it has given its drivers a total of $5 million, having initially collected approximately $1.7 million.