Market Overview

Food Delivery, Ride-Hailing Companies Plan Contingency Fund For Drivers

Food Delivery, Ride-Hailing Companies Plan Contingency Fund For Drivers

Food delivery and ride-hailing companies including Uber Technologies Inc (NYSE: UBER) and Lyft Inc (NASDAQ: LYFT) are looking to set up a fund to pay drivers who will be impacted by the coronavirus.

What Happened

Uber, Lyft, along with DoorDash, Postmates, and Instacart are all exploring ways to join forces to ensure drivers infected or quarantined drivers receive some form of compensation, sources told The Wall Street Journal.

Some drivers believe that a compensation package made available only after a diagnosis or quarantine won't be sufficient. This is because drivers act as independent contractors and would need to stop working as soon as symptoms start to appear.

"If I don't drive, I can't pay my rent, I can't pay for child support," Steve Gregg, a 51-year-old Uber driver in San Francisco told WSJ. "If you're only going to compensate us after we're quarantined, it's already too late."

Why It's Important

Drivers are part in a difficult position as they risk losing pay by staying home if they are sick or risk exposing other people at a time when demand for ride-hailing and food/grocery deliveries are higher than usual, according to WSJ.

Talks among ride-hailing and food delivery companies remain ongoing and a final plan is expected to come within days, according to WSJ.

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Photo by Robert Anasch on Unsplash


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