Uber tests rewarding top drivers with extra pay, college degrees
Uber, long criticized for its handling of drivers, is taking a serious step toward boosting their incentives.
On Thursday, the company announced Uber Pro, a driver loyalty program that offers perks ranging from extra pay and free online education to dent repair and gas discounts.
The program may help retain drivers, who often quit within a few months, research shows. Uber’s drivers are independent contractors so they do not receive benefits such as health care or tuition reimbursement.
Starting Thursday in seven cities and all of New Jersey, drivers will earn points for the rides they give to qualify for four tiers of status. They’ll also need a 4.85 rating and a cancellation rate of less than 4% to achieve either partner, gold, platinum or diamond status. The more rides a driver gives, the higher they rank.
Drivers in the top two tiers will receive a 3% or 6% pay boost depending on if they have platinum or diamond status. They’ll also get tuition coverage at Arizona State University’s online program. Tuition coverage can be passed onto a family member, too. Students will have to pay for their own materials, such as books and a computer.
According to Harry Campbell, editor of the The Rideshare Guy — a website for Uber and Lyft drivers — it’s a welcome change for loyal, longtime drivers who have felt undervalued by Uber.
“It’s really important that Uber is giving drivers more cash,” Campbell said. “If you’re putting in thousands of rides, have a high rating and have been loyal, there hasn’t been a financial reward.”
Drivers who rank the highest will also receive priorities at airports, such as getting paired faster with passengers. In addition, the company is offering up to 5% cash back on gas if they use an Uber Visa Debit Card. Extra points will be given for rides at busy times.
“This is a way for us to recognize the commitment and quality service from drivers,” Daniel Danker, head of driver at Uber, told CNN Business. “What drivers have told us is they want to earn more, spend less and for us to recognize their ambitions on the road and off the road.”
Rewarding drivers makes smart business sense for Uber, which plans to go public in 2019. Recruiting drivers is expensive, and many burn out. More than 60% of drivers are no longer active on Uber six months after starting, according to a study Uber and Stanford University published in July.
Uber also competes with its resurgent rival Lyft for drivers. An Uber driver working their way toward a college degree will have an incentive to stick around until graduation day.
The program also encourages drivers to give customers the best service. If a driver’s rating dips, they’ll risk losing perks and may be stuck with a tuition bill. If drivers lose status, they’ll have a three-month grace period to complete courses free of charge. Once tuition coverage is earned, it lasts for a minimum of six months.
Amit Singh, Uber’s head of global policy for work, noted in a blog post published Thursday how workers need increasing levels of education to stay competitive in today’s economy. Uber said half of its drivers aim to start a business, according to its surveys of drivers.
“We all have a role to play in helping people access opportunities that prepare them for success in the 21st century,” Singh wrote.