New York City Council votes to cap licenses for ride-hailing services like Uber and Lyft

The New York City Council has approved legislation that will halt the issuing of new licenses for ride-hailing services like Uber and Lyft.

The stated goal of the policy is to give the city time to study the industry’s impact. During that time, ride-hailing companies would only be able to add new vehicles if they’re wheelchair accessible. The legislation also allows the city to set a minimum wage for drivers.

There were drivers demonstrating in favor of the bill package outside City Hall today, and the Independent Drivers Guild (which says it represents more than 60,000 drivers for ride-hailing apps in New York City) praised the decision.

“We hope this is the start of a more fair industry not only here in New York City, but all over the world,” said IDG founder Jim Conigliaro, Jr. in a statement. “We cannot allow the so-called ‘gig economy’ companies to exploit loopholes in the law in order to strip workers of their rights and protections.”

Uber and Lyft, meanwhile, had asked their riders to oppose the legislation, saying that it would result in fewer drivers and less reliable service. They also suggested that there were other ways to address the underlying issues, and in fact proposed creating a $100 million “hardship fund” for drivers as an alternative.

Drivers demonstrating outside City Hall

In response to today’s news, Danielle Filson from Uber’s communications team provided the following statement:

The City’s 12-month pause on new vehicle licenses will threaten one of the few reliable transportation options while doing nothing to fix the subways or ease congestion. We take the Speaker at his word that the pause is not intended to reduce service for New Yorkers and we trust that he will hold the TLC accountable, ensuring that no New Yorker is left stranded. In the meantime, Uber will do whatever it takes to keep up with growing demand and we will not stop working with city and state leaders, including Speaker [Corey] Johnson, to pass real solutions like comprehensive congestion pricing.

The company plans to explore other strategies to keep up with demand. Those include recruiting drivers with licensed vehicles who aren’t currently working with Uber, or finding additional drivers who could drive licensed vehicles at times when they would otherwise be idle.

Lyft, meanwhile, sent this statement from its vice president of public policy Joseph Okpaku:

These sweeping cuts to transportation will bring New Yorkers back to an era of struggling to get a ride, particularly for communities of color and in the outer boroughs. We will never stop working to ensure New Yorkers have access to reliable and affordable transportation in every borough.

The New York Times reports that the cap will take effect as soon as Mayor Bill de Blasio signs the bill.

“Our city is directly confronting a crisis that is driving working New Yorkers into poverty and our streets into gridlock,” de Blasio tweeted. “The unchecked growth of app-based for-hire vehicle companies has demanded action – and now we have it.”