Time to set aside a little extra cash if you're an Uber or Lyft driver in San Francisco. For reasons unknown, the city has now decided to crack down on those who make a living (or even part of a living) driving other people around on either of the two big mobile ride-hailing services.
If you work in the city for seven days or more each year, which likely covers most of the drivers, then you'll have to pay a $91 fee for an annual business license (if you pull in $100,000 or less for your driving). Even better, when you get a notification in the mail telling you to pay up, you'll also be charged retroactively for any previous years that you didn't pay for a business license — including penalties and interest.
"We have a very broad and comprehensive business registration requirement. This has been a law that has been around for many years. It's very clearly spelled out on our website — the law here in San Francisco requires you to register your business with the city. If they missed that requirement, they are still obligated to do that," San Francisco City Treasurer Jose Cisneros told SFGate.
Though Cisneros didn't indicate a specific reason why now, of all times, the city is cracking down on license-free drivers, San Francisco did finally get an online business registration system operational last month. That likely makes the registration process much, much easier than having to submit raw paperwork in person at City Hall.
Additionally, San Francisco is likely cracking down now since it finally — via methods Cisneros didn't share — has a list of many of the Uber and Lyft drivers who have been operating in the city. Cisneros' office mailed out slightly over 37,000 letters yesterday to drivers who will now have to register as a business and pay up or tell the city that they haven't been ferrying passengers around at any point in the past 30 days.
As you might expect, the ride-hailing companies aren't taking the announcements very well.
"We have serious concerns with the city's plan to collect and display Lyft drivers' personal information in a publicly available database. People in San Francisco, who are choosing to drive with Lyft to help make ends meet, shouldn't have to compromise their privacy in order to share a ride," a lift spokesperson told The Los Angeles Times.
Uber was a bit more matter-of-fact in its response.
However, San Francisco's move does give both services a bit of an unexpected boost to their own arguments that their drivers are independent contractors, not employees. If they were the latter, they wouldn't have to pay any kind of fee for a business license. However, both ride-hailing companies would have to shell out quite a bit more in benefits and pay for their new employees, and these drivers would gain additional legal protections."Uber partners with entrepreneurial drivers and as independent contractors, they are responsible for following appropriate local requirements," said a spokesperson in a statement sent to SFGate.
If all of the drivers San Francisco is targeting end up paying up, it'll generate more than $3.37 annually for city coffers.