Saturday, March 5, 2011

The Uniform Lease: Part One

The February 21, 2011 Town Hall meetings for drafting a "Uniform Lease" was lead by Director of Taxi Services Christiane Hayashi with help from Enforcement and Legal Affairs Manager Jarvis Murray. The evening session was attended by the UTW's Mark Gruberg, Bay Cab's Roger Cardenas, Frank Fahey, Murai, myself and others along with TAC members Athan Rebelos, John Han and Bill Mounsey.

A document had already been outlined during the afternoon session from various existing leases including those from Green and Yellow cab companies.

The thrust of the "Uniform Lease" was to continue the myth of the "Independent Contract" while attempting to give drivers more protections and rights than they have now (not a difficult task).

Myth? The Independent Contract was intended as a agreement between people or groups with more or less equal power. It is an accurate description of the relationship between taxi companies and medallion holders. However, applying this concept of independence to groups of non-medallion holding drivers who are powerless and (from the companies' standpoints) infinitely replaceable is to create a fictional misrepresentation of reality.

The absurdity of this fantasy becomes clear in the first two definitions of a section called,

Employee/ Independent Contractor status
  1. Driver will not be treated as an employee for any purpose, including state and federal income taxes, the Unemployment Tax Act, and company will not withhold taxes.
  2. Driver has a right to apply for Worker's Compensation and Unemployment benefits under California law. Company will not oppose any claim for such benefits on the the basis that the driver in an independent contractor. (My italics.)

But I digress. For the moment, this Uniform Lease is to be between drivers and color schemes

Color Scheme Agrees

     To provide, maintain and insure a Vehicle in good condition and to provide a spare if the vehicle breaks down. Etc.

     The company also agrees -
  • Driver has absolute and exclusive rights to use, operate and control a licensed San Francisco Taxicab ...
  • Driver also "has complete discretion" as to how, if and when to work; when and if to take breaks.
  • Driver is also not required to report locations to the company or take or respond to dispatched calls.
All of which, as John Han pointed out, define the driver as independent contractor. Han went on to say that he thought drivers should actually be treated as employees.

Director Hayashi responded by saying that she thought that doing so would "require tearing the industry apart and putting it back together again in a different way because the current model does not assume employee status and cannot economically support it."

John said that such a tear down and re-assemble might be a good idea.

Required Driver Conduct

Driver Agrees
  • To maintain the required licenses and permits.
  • Take care of tickets.
  • Inspect the vehicles before using them.
  • Report any collisions or anything else that might risk liability to the companies.
  • Etc


The proposed contract would be an automatically renewable 30 day contract that could only be ended by a 30 day notice and/or must have cause.

This last clause is different than many current contracts which state that the contracts can be terminated without cause - a situation that gives tremendous power to the companies.

Under the Uniform Contract

The driver could Terminate for Cause
  • A material breach of lease terms
  • If the driver has notified the company of unsafe vehicles or conditions and the company fails to correct said conditions
The Company could Terminate for Cause
  • A material breach of lease terms
  • Driving under the influence or reckless driving.
  • Fail to report an accident.
  • Etc

Next -

Security deposits - Yes but?

Pre-pay by 28 days - No

Vacation /sick time

Mediation Resolution?

Pro rata - probably

Driver training - definitely

The photo has nothing to do with leasing but for some reason I kept thinking about this Chinese mountain lake during the discussions and I thought I'd share it with you.


  1. The comment I made about tearing down the industry and rebuilding it to an employee model was rhetorical. The point being, while we are called "independent contractors", in reality we are not fully independent contractors.

    Cab companies control the shifts and hours available to a non-medallion cab driver. Therefore, where it says that a driver, "has complete discretion" as to how, if and when to work....", it is not totally true, since companies actually control "if and when" a driver works.

    Also, if cab companies opt out of OTA, they would be restricting the 'manner and means' with which a cab driver could access fares through innovative technology, therefore giving auditors reason to believe drivers are employees of the cab company. But pointing these things out is different from saying "we should be employees", which is not what I'm saying.

    SFMTA standard lease agreement between a non-medallion driver and a color scheme should include protections in it for the non-medallion driver, that are similar to the way labor laws protect employees, since non-medallion drivers are not fully independent. That's not quite the same thing as saying "we should be employees".

  2. My mistake.

    It should be interesting to see if people not a in position of equal power can achieve the rights of an employee.

    I too have high hopes for a lease agree that is fair to drivers but can such a document be enforced?


  3. Cab drivers are actually not ICs as the way it is now. One day there will be legal issues and that is the time the state law will define the status of IC. I was working as IC in delivery services and I choose the hours and days myself. No one tells me when to work. Lets see who will win at the court when there is dispute.