WASHINGTON, June 20, 2017 – Ridesharing company Uber announced on Tuesday that it will now allow drivers to collect tips through its phone app.
This is a sudden reversal from previous company policy. This new policy comes as Uber continues to deal with a series of scandals including sexual harassment allegations, the sudden departure of executives and a video of Uber CEO Travis Kalanick arguing with an Uber driver.
Uber Technologies had been strongly opposed to offering a tipping feature to the app despite driver’s arguments that the money would help compensate for decreasing wages.
The issue had been a longstanding source of disagreement between Uber and its drivers. Uber drivers are independent contractors and not employees and therefore do not receive paid sick leave and vacation and must pay for car maintenance and other incurred costs.
Houston, Minneapolis, and Seattle will be the first cities able to tip drivers. The rest of country’s drivers will have access to this feature by the end of July. Uber also announced other changes including paying drivers while they wait for passengers and reducing the time passengers have to cancel a ride.
Uber’s top competitor Lyft has supported tipping since its early days. Kalanick opposed a tipping option believing that mixing tips with the rating system would cause problems for riders.
It’s been suggested that to avoid this conflict is to allow riders to tip discreetly, so tips are not tied to a rider’s identity.
Uber’s new rollout is part of its “180 Days of Change,” which is an attempt at rebranding the company as they jump through hurdles. Uber executives have confirmed that they won’t take a cut of driver tips. They will still be collecting a portion of ride-cancellation fees and the new waiting time charges.
The Department of Justice is currently investigating Uber’s attempt at thwarting regulators.