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Uber Hit with $650M Employment Tax Bill in New Jersey

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Re: Uber Hit with $650M Employment Tax Bill in New Jersey

#101

Post by turc1656 »

listenallyall wrote: post #77
fungiblecog wrote: post #59

Earlier quoted context omitted.

Contractors can set their own rates. These drivers are employees.

Taxi drivers don't set their own rates. What's the proper categorization?

The taxi analogy isn't the same. The rates are being set by the local government, not some non-government third-party whom they work with like perhaps the people who actually own the medallions (most are loaned out) or the people who lease out usage of the vehicles, etc. If those places were setting rates on what could be charged then I'd say there's an argument to be made. Also, let's not forget why the government put in those rules on setting the rates in the first place - consumer protection. Cabbies were routinely ripping people off.

Furthermore, it's not just one thing. It's a set of criteria/tests that for certain states like CA and NJ are defined in the law. Taken in aggregate and not just on one single characteristic of the employment a determination can be made.

Re: Uber Hit with $650M Employment Tax Bill in New Jersey

#102

Post by turc1656 »

pat87 wrote: post #62
microtherion wrote: post #18

Earlier quoted context omitted.

In my book, it's not a "business model" until it's consistently profitable.

There can be a bad “business model”

Exactly. It's just a model of how to piss away money and look bad doing it. Haha.

Re: Uber Hit with $650M Employment Tax Bill in New Jersey

#103

Post by gamblor956 »

listenallyall wrote: post #56
navigatr wrote: post #50

Earlier quoted context omitted.

These talking points died in 2016. Now that Uber isn't subsidizing rides with investor's money and raised their fares, Uber is actually more expensive than taxis in NJ. There's no reason ride hailing companies need to violate labor laws to do business.

Source? At EWR a few weeks ago while waiting for luggage, I wandered over to the taxi stand. The quoted fare (there was no line, by the way) was twice that of either Uber or Lyft to the same destination.

LAX to downtown: Uber and Lyft are cheaper in the middle of the day between lunch and the evening rush hour, and again after 9 or 10p M-Th.

Early morning through rush hour, and evening rush hour: 2-5x more expensive than a cab, depending on surge pricing.

Holidays: 3-20x more expensive than a cab, depending on surge. I have seen multiple Uber and Lyft fares that would have cost more than the plane ticket did.

Re: Uber Hit with $650M Employment Tax Bill in New Jersey

#104

Post by nemo44x »

Shivetya wrote: post #34
toomuchtodo wrote: post #11

Earlier quoted context omitted.

Proof that voting works (IMHO). Local residents won against a distant corporate entity.

well preying on ignorance is the game of politicians and they won. Yes I am saying it was a loss for the rest of us. why? politicians and their allies successfully portrayed the home sharing industry as the reason for rising rents when in fact it has long been because politicians and those using their connections which have been the cause. oh they hide it well but the idea is to keep their investments up and keep "th…

I think it's perfectly reasonable for people to not want their apartment building to become a hotel.

I agree more units need to be built and development should be encouraged. Given a referendum I'd vote against allowing short term rentals not because I'm nervous they raise rents but because I don't want my building to be a hotel.

Re: Uber Hit with $650M Employment Tax Bill in New Jersey

#105

Post by ranDOMscripts »

listenallyall wrote: post #66
kapuasuite wrote: post #44

Earlier quoted context omitted.

These are the same elected officials who let taxi companies rip off passengers for the better part of a century by limiting competition through the medallion system, and protect hotel interests because they’ve been able to tack a ton of extra taxes onto every hotel bill?

Before the smartphone era, the only possible way to ensure availability of personal transportation was to have a functioning taxi & livery industry. The use of medallions was actually to protect the public, ensuring all drivers were at least accountable and traceable and thus somewhat safe, just like today's Uber riders expect the company to perform background checks on drivers. Yes it benefitted embedded interests,…

If "protecting the public" was truly the goal, why not make taxi driving as simple as getting a commercial endorsement on your license? Driving 50 people in a public bus only requires X hours in a classroom and an extra exam (or two, depending). Interestingly, the medallions were affixed the the vehicle (thus allowing anybody to use it), the total number of medallions were artificially limited and the choice parts of the city were off limits to competition. Does that really protect the public or does it just protect those who own the medallions?

Re: Uber Hit with $650M Employment Tax Bill in New Jersey

#106

Post by lost_access »

Shivetya wrote: post #40

I am really curious how they arrived at any of the numbers in this article. Seriously, what other large employers make it to hundred plus million per year? Are they just up and deciding that anyone who did one trip is now an employee? Is there a source that shows how much each company pays per year in this state? who else is equivalent? this isn't about protecting the drivers, this is about protecting the taxi indust…

Also the acid test is whether the drivers are qualified for unemployment benefits.

Re: Uber Hit with $650M Employment Tax Bill in New Jersey

#107

Post by Keverw »

nemo44x wrote: post #24

There's no escaping this from states like NJ, CA, IL, MA, and NY. These states (of which I am a member of) are broke with pension obligations waiting to bankrupt the government. Taxes are already high both on income and property so there's nowhere to go there. They have old infrastructures and although the citizens are heavily taxed, government can't make improvements in large part because of lifetime pension obligat…

Yep, I think the census next year is going to hit some states hard, losing both residents, federal funds and seats. United Van Lines did a study and NJ was the top moved out state.

Not sure how you can compete with Florida though, when your state has high taxes and it's cold. If they make infomercials for both Florida and NJ or even OH... Obviously Florida would be the better choice. Warmer, less taxes, friendlier to businesses, world class cities, the top theme parks in the world, if you want to go on a cruise not that far from a port... and plus residents get discounts on theme parks even cruises. Then from my impression of places like NJ or NY people always seem in a hurry and sometimes even rude. While it seems like people from FL are more relaxed and happier.

Plus since things are less industrial and more tech or done remotely it's easy to get up and leave than before. Got a hedge fund? Relocate to FL and then fire anyone that doesn't want to move with you. Miami sounds more appealing than Wall St. to some of the change makers, plus with the wealth tax idea that's being pushed and other stuff, what's the incentive to stay when you can vote with your feet? Plus it's not like New York is it's own country, so citizens there have 49 other choices they can move to.

There was a recycling plant that had trouble getting approved in Los Angeles, even 10 years later. They relocated to Arizona and got approved in a single day. I think more people and companies should do that. Let these states lose out and fail, the states that make things better and easier will win. There CEO had much more patience than I'd have if things were moving that slow. Uhaul trucks leaving California cost more than heading back to California. So I think people are getting sick of states, and cities especially when they quit listening to people. California lessen the punishment for stealing, so more stores are being stolen from too sadly. Also they are tough on truck drivers, so some drivers rather just avoid California completely.

Re: Uber Hit with $650M Employment Tax Bill in New Jersey

#108

Post by privateSFacct »

jjoonathan wrote: post #98
privateSFacct wrote: post #82

Earlier quoted context omitted.

Those talking points are 100% true. Uber started in San Francisco. You could not get a cab on the weekend for any amount of $. You could not get a cab to come to the "tough" neighborhoods. This is 100% fact. I once called 4x and was told one was coming - falsely (I did live in what was then a "bad" neighborhood). My roommate walked across the entire city. Uber started with licensed transit vehicles - now called uber…

> I once called 4x and was told [a taxi] was coming - falsely Same deal in Pittsburgh, though I only called 2x on the first instance and 1x on the second. Then I stopped using taxis unless forced. > credit card machine "broken" This happened twice last week to me in SoCal and seems to happen about 50% of the time I use taxis.

I called maybe 20x before "getting" it - the taxi is coming was 100% a lie. They were very likely redlining where I lived.

I paid happily for uber black when it came out - whatever people think of uber costs now - original uber was NOT cheaper than a taxi as I remember - BUT you could actually get it. But I might be wrong - for me, I just wanted to be able to get something so I could avoid owning a car (most of the time bus etc works but not always).

Re: Uber Hit with $650M Employment Tax Bill in New Jersey

#109

Post by xenocyon »

Shivetya wrote: post #40

I am really curious how they arrived at any of the numbers in this article. Seriously, what other large employers make it to hundred plus million per year? Are they just up and deciding that anyone who did one trip is now an employee? Is there a source that shows how much each company pays per year in this state? who else is equivalent? this isn't about protecting the drivers, this is about protecting the taxi indust…

You make reference to protecting mass transit as well as to the cost to consumers. These arguments make sense if there are zero externalities, but unfortunately there are: carbon footprint, both directly as well as second order effects from increased congestion, commercial exploitation of subsidized infrastructure, increased collision risk to cyclists and vulnerable road users, abuse of contract law by preventing independent rate setting and concealing negotiable information, artificially depressed prices fueled by venture capital in order to create a monopoly and capitalize later. These externalities are borne by society at large, so a pure "let the consumer decide" philosophy is not fully justified in this scenario. Some of these externalities apply to taxis as well, which is precisely why regulating and limiting taxis is good, though I think one could do a lot better than the medallion system.

Re: Uber Hit with $650M Employment Tax Bill in New Jersey

#110

Post by throwaway_tech »

subsaharancoder wrote: post #99
IanCal wrote: post #81

Earlier quoted context omitted.

Taxation is, broadly, spent on citizens and citizens benefit from that. I pay taxes that cover the police as well as the schooling that lowers the chance of people around me having to resort to crime.

In the context of Uber vs NJ, the drivers are already remitting taxes as contractors. The $650M demand from the state isn't a driver initiative with them demanding "Uber needs to pay more taxes.." it's the state saying "What we've collected from drivers isn't enough and we want more from Uber.."

>"What we've collected from drivers isn't enough and we want more from Uber.."

Or its fundamentally correct under the law and Uber has misclassified its drivers as independent contracts whereas they should properly be classified as employees.

After all Uber did disclose this was significant risk in their S-1, and further that such a reclassification could be an existential threat to the business.

It sounds conspiratorial, but now that they have gone public (and investors have cashed out and dumped the bag) the money that was roadblocking these moves by government (note the article makes it clear NJ has been pursuing these taxes for 4 years) has dried up and governments will begin to act. Its no surprise to anyone in the know, just follow the money (in this case the shorts)

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