The Advantages and Disadvantages of Ridesharing

close up of hands holding cell or mobile phone with rideshare app open

Ridesharing companies such as Uber and Lyft are quickly becoming the favored option over taxis in population-dense cities like Chicago. In July 2017, it was reported that Uber was a more popular choice over taxis in New York City, with an average of 289,000 Uber rides per day compared to taxis 277,000 rides per day. And from 2016 to 2017, ridesharing trips increased by 37%. Since then, they've continued to rise in popularity.

But why are rideshares becoming more popular? Are they really a better option than classic taxi rides?

Advantages of Ridesharing

There are a few key advantages that people have identified when it comes to ridesharing apps such as Uber and Lyft.

Ridesharing apps increase the mobility of people with disabilities, seniors, and low-income households.

UberASSIST was designed to offer door-to-door assistance for the millions of disabled and senior populations. And both Uber and Lyft work directly with senior centers, retirement homes, and healthcare organizations to arrange rides for seniors and individuals with disabilities who may struggle to use technology. They arrange for drivers who are specifically trained to help seniors and people with disabilities to ensure the best possible experience.

When it comes to low-income households, Lyft actually offers discounted rides to grocery stores to ensure that they can have access to fresh ingredients and healthier food options. At one point, they even pledged to transport veterans and low-income family members to job interviews and medical appointments.

There are lower levels of discrimination than with taxi services.

Research has found that discrimination is higher toward black riders hailing or arranging for taxi services. When it comes to black riders, taxis have a much higher chance of canceling or making their rider wait up to 15 minutes longer than white riders. According to Anne Brown, Ph.D. and Assistant Professor of Planning, Public Policy, and Management at the University of Oregon, ridesharing services "nearly eliminate the racial-ethnic differences in service quality."

Ridesharing apps provide convenient, quick, safe, and more affordable transportation.

Taxi rides can cost 20-30% more than ridesharing apps and have shown to be less reliable overall. Rideshare apps also have integrated safety features that enable riders to see the license plate, car model, and picture of their driver so that they know they're getting into the correct vehicle for their ride. Rideshare apps also have the capability to share routes with family and friends, provide driver ratings, and have cash-free transactions.

Ridesharing apps keep drunk drivers off of the road.

A third of ridesharing passengers who own vehicles said that the main reason they choose ridesharing is to avoid driving drunk. Additionally, research shows estimates that ridesharing (if implemented across the country) could save an estimated 500 lives and $1.3 billion in taxpayer money annually by decreasing DUI-related accidents.

Ridesharing apps have created millions of jobs in the U.S.

Most Uber and Lyft drivers use the money they make from driving as supplemental income, but it's becoming more common to see full-time drivers in big cities that are seeing higher demand for rides. Drivers love the flexibility of the work and that they can choose their own hours, plus the added bonus of getting to know their way around their cities and seeing more than they would otherwise.

Disadvantages of Ridesharing

As with all things, there are also disadvantages to ridesharing, including but not limited to:

  1. Increased emissions, traffic congestion, and decreased use of public transportation
  2. Drivers often make less than minimum wage, which can lead to difficulties paying for gas and vehicle repairs
  3. Rideshare apps have a history of limited background checks for drivers, while taxi drivers are subject to more intense security screenings that involve fingerprinting checks for the FBI database

The third disadvantage above leads us to question whether rideshare apps are as safe as they claim to be. Let's dive into that.

Risks of Ridesharing

Taxi drivers have been around for over a century and, as such, have been given certain requirements and regulations they must follow (granted, this is different from city to city). They must all abide by consistent guidelines when it comes to hygiene, driving records, and cab cleanliness. They are also all professionally trained to do their jobs.

When it comes to ridesharing apps, there are fewer regulations and requirements, and the drivers are not professionally trained. Rideshare drivers are also not employees of the rideshare apps- they are contractors, which means that when legal issues arise, typically the driver is the only one that can be held accountable and it's much more difficult to sue the rideshare apps themselves.

When it comes to ridesharing, safety is also a concern. There has been a history of drivers with criminal records slipping through the background checks, cases of aggression and assault by drivers, and imposters posing as rideshare drivers. Riders have to be extremely aware of these possibilities and take precautions where possible if they intend to use rideshare apps.

Ridesharing from a Legal Perspective

Many companies choose to partner with rideshare organizations, but at what risk? Clearly, there are benefits to doing so, but there is also liability exposure.

When Uber launched their B2B platform (Uber for Business) in 2017, it enabled companies to organize rides for their employees, customers, or partners. The way it works is that it allows approved rides to be charged automatically to the company account and provides all details regarding the rider, the location they left from and went to, and when they did so. This exposes companies to financial theft, cybersecurity threats, and confidential company data theft.

There also arises the question of passenger safety. As discussed earlier, there is a history of unsafe drivers within Uber and Lyft. If a company were to send a passenger with a rideshare driver and they were to be assaulted or harmed in any way, who would be held responsible? In many cases, the company that contracted the rideshare could be held responsible for negligence in selecting vendors with unsafe hiring practices and exposing riders to risk. If the rider was an employee, they may also be entitled to worker's compensation.

This is why it's critical that companies review the hiring policies and practices of rideshare apps from a legal standpoint. If you are a company in need of legal help to establish a partnership with ridesharing apps, we can help get you squared away!