Driving a taxi is one of the toughest jobs in New York City.
Many cabbies work 12-hour shifts, seven days a week, in all kinds of weather — providing an essential service without minimum wage, overtime or the other basic labor protections that most workers enjoy.
One of the few safeguards cabbies do have are caps that limit how much fleet owners can charge drivers who rent out their vehicles. But even under the best of circumstances, it’s difficult for cabbies to make ends meet.
So when unscrupulous fleet owners cheat drivers out of their already meager earnings by charging inflated lease rates and adding on illegal extra charges and fees, vigorous enforcement is needed.
That’s why, this year, the attorney general’s office and Mayor Bloomberg’s Taxi and Limousine Commission formed a partnership to investigate and bring cases against fleet owners who violate lease cap rules.
Now, we have completed our first enforcement action, against the owner of one of the largest taxi fleets in the city — and secured a first-of-its-kind agreement that protects cab drivers’ rights.
Evgeny (Gene) Freidman, who owns nearly 900 taxi medallions, will pay nearly $750,000 in restitution to more than 1,000 drivers who were charged inflated lease rates and bogus fees, as well as $500,000 in fines. Going forward, increased oversight will ensure that his taxi companies comply with the law.
This agreement is a victory for basic fairness in an industry that has seen the value of taxi medallions soar while cabbie pay has stagnated.
Despite enormous economic and population growth, the number of taxis in New York has remained relatively unchanged since the 1930s. Today, there are just 13,000 or so yellow cabs in a city of 8.4 million people — and the value of a single taxi medallion has skyrocketed to upward of $1 million.
At that price, few cabbies can afford their own taxis, so they lease cabs from fleet owners like Freidman. Because they work as independent contractors rather than employees, they are exempt from most basic labor protections.
Lease cap rules limit the owners’ take to roughly 40% of passenger fares. Gas, insurance and other expenses eat up another 10%, leaving cabbies with only about half the money they bring in each shift (and sometimes much less, when weather or other factors keep fares inside) — often barely equaling the minimum wage.
Deep-pocketed fleet owners cannot be allowed to take more than their fair share from hardworking drivers who depend on their cabs for their livelihood.
Our approach to keeping owners honest represents a new approach to workplace protections in an age when New Deal labor laws no longer apply to large segments of the American workforce. A state appeals court this year ruled that individual drivers do not have the right to sue fleet owners under lease-cap rules; for them and all independent contractors in non-traditional workplaces, strong government enforcement is more important than ever.
Low-paid, unskilled workers, especially immigrants, are too often vulnerable to employers who steal tips, deny overtime and pay less than minimum wage. In recent months, workers in the car-wash and fast-food industries have fought back against labor abuses, aided by enforcement efforts from the attorney general’s office and other government agencies.
Like them, cab drivers deserve an honest day’s pay for an honest day’s work. As a new generation of progressive labor leaders seeks new ways to protect these deserving American workers, we will continue to work creatively to enforce labor laws — and to use all the laws at our disposal — to ensure that every worker gets a fair shot and every company pays its fair share.
Schneiderman is the New York State attorney general. Yassky is the commissioner of the New York City Taxi and Limousine Commission.
