Uber drivers face earnings drop as coronavirus bites

Uber drivers are facing a drastic fall in earnings after the taxi-hailing firm stopped collecting three percent of fares as commission and returned the 25 percent fee, citing reduced business in the wake of coronavirus.

The firm has scrapped the three percent commission and reverted to the old rates, which have been contested by drivers for a long time.

Uber said the decision was due to decreased trips demand that followed the movement restrictions imposed to curb the spread of the virus including a daily dusk-to-dawn curfew as well as closure of schools, bars and nightclubs.

“We are making these changes as a result of the unprecedented times we find ourselves in, with an aim to ensure long-term sustainability of the business,” Uber said in a letter sent to drivers last week.”

Uber, in October last year, adopted a new pricing model that significantly increased the cost of rides and introduced a new driver commission metric.

The new model saw ChapChap taxis pay 25 percent commission on the first 15 weekly trips and thereafter remit three percent on the remaining journeys completed.

“While incentives for drivers in Kenya will be put on hold during the Covid-19 pandemic, drivers still have access to injury protection and all our safety features such as the in-app emergency button, as well as access to 24/7 support,” said Uber spokesperson Lorraine Onduru.

“This is not permanent and our teams will continue to monitor the situation. We are committed to working with government agencies and other stakeholders on their behalf to ensure they are supported during this difficult time.”

Prior to Uber’s decision in October, digital taxi operators had been grappling with frequent drivers’ strikes, with operators calling for fare increases to cover increased fuel and vehicle maintenance costs.