Taxis in Philly, part 1: Why drivers feel overworked & underpaid

By Randy LoBasso
Add Comment Add Comment | Comments: 9 | Posted Feb. 25, 2014

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There are lots of cabs in Philadelphia, as seen any given day at 30th Street Station—but not as many as there are drivers eager to work. (Photo by J.R. Blackwell)

Three men have laid a thin, brown blanket over the elongated trunk of a Crown Victoria in a Southwest Philadelphia parking lot. One of them, dressed in a brown coat and a flat charcoal cap, shakes his loose fist and releases two dice onto the trunk. The little cubes spin across the blanket, up the glass of the rear windshield and back onto the cloth, where they stop in unison. The roller is disappointed.

A few feet away, a heavily accented West Indian man laments, in broken English, his decision seven years ago to sell his taxi medallion for $32,000. Sure, he says, that was a nice chunk of change to bring in, but today, here he is, still driving a cab 12 to 16 hours a day, now paying to rent back that same medallion—the small metal plate representing cab licensure—which, in today’s market, could be sold for upwards of $500,000.

These two cabbies aren’t alone, either in this parking lot or in their grumbles. Hundreds of men—there are only men, mostly of African and Central Asian descent—are here this afternoon, waiting a short distance from the airport till it’s their turn to head to the terminal taxi stand and pick up a $30-plus ride to Center City or beyond. They’re here because it’s the deadest time of the day—between 11 a.m. and 2 p.m.—and the airport is the best spot to find a guaranteed fare without burning too much gas. And as they wait, their complaints about their professional situations are similar: the hours, the money, the customers, the risks they take on the job.

Driving a cab is the seventh-lowest-paid dangerous job in the United States according to 2013 statistics from the Labor Department. The gig sees 19.7 deaths per 100,000 workers; that makes it more dangerous than being a firefighter. The median salary, nationwide, is $22,820.

Philly cabbies say they’re not even reaching that median.

Complaining about your employment
is second nature to most Americans. A 2013 Gallup study found a whopping 70 percent of us aren’t satisfied with our jobs. But the taxi industry is a unique situation—partly because it used to be the sort of business that was tough, but had a huge payoff.

The idea of making your own hours and eventually, someday, earning enough to buy your own taxicab operation provided the sort of American Dreamery that many low-wage jobs simply can’t promise. While cab-driving pay isn’t exorbitant, it certainly beats the minimum-wage dungeons like McDonalds or Wal-Mart—and when it comes down to it, you don’t need to know much more English than the names of the streets your customers are headed to.

Most drivers in town own their own cars, but not their own medallions, which they lease from cab companies and other owners. Other drivers rent the medallion and car together. The Philadelphia Parking Authority, which has overseen Philadelphia’s taxis since a 2004 law transferred responsibility from the Public Utility Commission, holds the mandate to enforce certain costs and regulations as it pertains to drivers and their vehicles in the city—including the maximum amount, the “lease cap,” that drivers may be charged to use a medallion and/or car. For drivers who own their own cars, the medallion lease cap is supposed to be $420 a week or $70 per day; to rent both a medallion and a car, that price goes up to $570 a week or $90 per day.

Last November, though, the Taxi Association of Philadelphia, a nonprofit dedicated to representing drivers’ interests in the industry, sent a complaint to Pennsylvania Attorney General Kathleen Kane, alleging that drivers are being charged more than those stated rates.

“Instead of drivers paying $420 to lease per week, they are paying $450–$475 per week,” wrote Ronald Blount, the association’s president. “Drivers do not have the option of taking a day off. They are required to work weekly or lose the right to lease the medallion.”

Every driver PW spoke with said they are among those being overcharged; all fear reprisal if they say so on the record. The problem: Philly has relatively minimal laws on the books providing protection for a driver who comes forward to complain about the medallion owners from whom they rent—even as the demand for medallions has grown so high that resale prices have spiked beyond most drivers’ ability to work their way toward ownership.

“Almost 80 percent of the drivers are overpaying what the legal rate is,” Blount tells PW from his office in West Philadelphia. “They’re overpaying because they want to get a cab.”

While Kane’s office has been silent on the issue thus far, the PPA agrees it’s happening.

“We’ve heard complaints about this on and off for several years,” says James Nye, director of the PPA’s TaxiCab division. “We said, ‘You need to bring this information to us and show us the receipt.’ Many drivers have not been willing to do that because they fear retribution and being let go and [having to find] another medallion owner to work with.”

PPA has issued some citations over the years, Nye notes, but “what we really need to do is open an investigation, and we’ve been discussing it internally here.” He expects such an investigation will be part of the agency’s next review of the city’s taxis—the last of which occurred in 2008 and raised passenger rates.

Part of Blount’s job at the Taxi Association is to look at what other cities have done to keep their drivers happy, and to try and replicate it. In Toronto, for example, the city recently passed a law creating a two-tiered system to eliminate middlemen and ensure the industry becomes driver-owned within the next ten years. In New York City, the laws are similar to Philadelphia’s, but that city has harsher rules in place that protects drivers from the leasing companies when complaints are made of medallion-owner wage-gouging.

One Philly driver, who doesn’t own his own car, tells PW he’s been leasing his cab for $900 per week. Guys like that, says Blount, are often recent immigrants to the United States, who think they can get ahead of the high rates by working long and hard. But they can’t. And while the medallion issue is the most overt challenge, it’s not the only one.

Drivers who rent their cabs by the week are entitled to all the cash they bring in. That sounds better than it is. For instance: Every time a passenger pays with a credit card, Verifone, which runs the system, keeps about 5 percent of the fare. If a driver crosses the Ben Franklin Bridge, pays the toll, and adds it into the final fare, they only get 95 percent of the toll back. And since credit-card payments have to go through the cab companies first, the driver doesn’t see that money until at least three days later.

That sucks—but it’s the standard. And at the time that deal was negotiated, it was actually the best rate in the country for drivers, since the PPA agreed to mandate credit card acceptance across all cabs.

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Comments 1 - 9 of 9
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1. Nikki W said... on Feb 26, 2014 at 01:06PM

“I attempted to use Uber a couple of weeks ago in Manayunk and the car never showed up. There were plenty of cabs but none of them would stop. The one that I ended up riding in was illegal and and he charged $65 for a $20 ride.”

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2. Steve Chervenka said... on Feb 26, 2014 at 07:09PM

“The indignity discussed is worst than reported. 100% of the risks of driving a cab are on the drivers, and the owners get a free ride. This is why the medallion is so expensive.”

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3. vrb0322 said... on Feb 26, 2014 at 08:14PM

“Here are my issues with some cab drivers the language problem with too many of these drivers. Not being able to use the GPS effectively because they can't spell or understand a word ) But they sure know how to count that money.Getting a cab after hours has become a chore. Most of these drivers do not want to go outside the city limit unless you are at the airport. Two New Year's Eve ago I spent a good part of 2 hours trying to secure a ride from Ole City to my home outside the city.No one wanted to stop because once they found out they would have to go outside the city limits and could not pick up anyone till they reached the city limits on the return trip that 32.00 trip was not worth it. I lesson learned I no longer stay in town pass the time the el is running and I no longer come in town to celebrate New Year's Eve.”

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4. Anonymous said... on Mar 3, 2014 at 12:53AM

“Every taxi driver has to go through a training class and a drivers u c on the street they already have the certificate from PPA, SO I wud say it is their responsibility to have a standard training class and most importantly every drivers shud go through a mandatory drug test , I doubt PPA CAN AFFORD IT, U KNOW WHY THEY WILL LOSE MONEY BY DOING THIS, the catch is they charge $125.00 from every new drivers for the class and every single week there r 15-20 new drivers r coming on the business!!! Where there r already 4/5 thousands drivers allready in the market, on top of that they charge$80.00 from each drivers every year to renew the license! So u tell me if PPA START cracking down on those bad drivers who r on drugs! And who ever has language problems they gonna start losing money!! Which they cant afford it....its easy to blame the drivers but think about the good drivers who work hard every day and stil ppl blame them and no one seems to understand their problems.”

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5. Anonymous said... on Mar 14, 2014 at 07:32AM

“the problem is not drivers on drugs the problem is the high lease rates and long hourse drivers have to work to make a fair living if i lease a cab for a weekly lease i can drive a maxium of 14 hours under the law i pay 90 bucks a day to rent the cab and 50 bucks in fuel so if i average 15.00 an hour during my 14 hours i make 210.00 minus the 90 minus the 50 i am making 70 bucks for 14 hrs work”

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6. Anonymous said... on Mar 18, 2014 at 01:34AM

“All I have to say it's all ppa fault I hot million n 1 thing to say abt ppa n put the out off this taxi business”

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7. Anonymous said... on Apr 17, 2014 at 01:24PM

“How about mandatory spell check before you post a comment?”

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8. Blue Dog said... on May 31, 2014 at 03:02PM

“It is the reason we need to tax fairly ... not break the backs of the working class... a hedge fund manager that makes 500 million dollars a year only pays capital gains taxes , not income tax......

Big business and people like the Koch Brothers dictate to keep the little person exactly that....Little with no say.... They intend to spend $125 million dollars on the 2014 midterm elections .... a mere drop in the bucket of their $100 billion dollar ill gotten fortune”

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9. Brandon said... on Aug 14, 2015 at 01:05PM



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