COMMISSION AND FEES: WHAT UBER DRIVERS SHOULD KNOW

Author photoBy Michele Washburn

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Everyone gets into the rideshare industry for different reasons, but we all want to earn the best paycheck possible for the hard work we put in on the road. That’s why it’s important to understand that we only earn a fraction of the total overall toll our passengers pay. That means your rider could get charged $10 for a quick and short trip, but, when you are compensated you might see something between $5 to $7 of that ten buck ride. Let’s look into what the company has to say about those funds you helped them earn.

 

Drivers for Uber are told by the company that they will be charged a service fee of 25% for every fare collected. According to Uber’s website: “This is a fee Uber charges for trips made through the app that helps fund things like app development and customer support.” While that may seem like a cut and dry arrangement that will make it easy to calculate your earnings, multiple reports from Uber drivers across the country claim the service fee can hike significantly based on a number of factors we will explore today.

 

If you’ve been a rideshare driver for a while you’ll have a better understanding how much you make per mile, since however much commission charged by the company you’ve partnered with varies based on a number of factors. Let’s just say, before we proceed any further than we already are, that the “service fee” won’t be the only expense you will encounter on the road as a rideshare driver.  

 

One Uber driver shared her experience she had with a representative from the company. The driver sent an inquiry which asked why she had earned much less than the 75% of a passenger’s fare. This is what the Uber rep wrote to the driver:

 

“Service fee amounts vary per trip; they are not a set percentage. You can always see what the rider paid and what Uber received under “Fare Details” on the “Trip Details” page for any given trip. Uber estimates the length of each trip and generates an upfront fare for the rider before the trip starts. If the trip price is more than the base time distance (surge), Uber collects the difference. And when the price of the trip is less than the base time distance, Uber covers the cost. The driver will always make the same rates, independent of the price estimate.”

 

While that might read perfectly fine, like the company is being fully transparent, it did not account for the fact that drivers are now being given multiple quotes that purport differing stories on their service fees. While it might be hard to accept that Uber takes a major percentage of your fares, remember the company is directly responsible for linking you to your passenger.

 

Without the app, you’d likely have a very different job than you enjoy as a rideshare driver. Because Uber allows you to set your own schedule, work at your preferred pace, they require a cut from your trips to invest more in the company’s growing technological advancements that, ideally, lead to a more efficient and increasingly lucrative field for drivers.

 

A driver in San Francisco claims Uber’s fees take, on average, 50% of a fare, if not more at times. Because of the changing economy, rideshare trends, corporate opulence and shifting demand, rideshare drivers are forced to fight for every dollar they are owed.

 

Does all of that mean you shouldn’t drive for Uber? No, there’s still plenty of money to be made, but you need to be aware of the financial risks associated with the job. Stay vigilant in your pursuit for fair pay and speak up if you think something unfair happens. Plenty of rideshare drivers are registered for Lyft, Grubhub, DoorDash and other freelance driving gigs that allow the freedoms enjoyed by those looking to work for themselves, on their own terms.

 

Are you a rideshare driver who is looking to save time, money and energy in between passengers? You should definitely check out RideShare Mechanic, a service that allows you to complete mandatory vehicle inspections from your own home. All you need is a smartphone and RideShare Mechanic will connect you with a certified auto technician who will guide you through what parts of the vehicle to film with your phone. It’s easy and saves you an extra trip to the garage if you’re already up to date on your service schedule. Try it today!