Ride-hailing companies Uber, Lyft won't testify before Congress

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© Reuters. FILE PHOTO: A screen displays the company logo for Uber Technologies Inc. on the day of it's IPO at the NYSE in New York© Reuters. FILE PHOTO: A screen displays the company logo for Uber Technologies Inc. on the day of it’s IPO at the NYSE in New York

By David Shepardson

WASHINGTON (Reuters) – Uber Technologies (NYSE:) Inc and Lyft Inc (NASDAQ:) declined to appear on Wednesday at a U.S. House of Representatives hearing on issues relating to the ride-hailing industry, a congressional committee said.

The two ride-hailing companies had been asked to appear as part of a House Transportation and Infrastructure Committee inquiry on safety and labor practices as lawmakers seek to prepare legislation that will impact the industry.

“Their failure to appear at this hearing is a telling sign that they would rather suffer a public lashing than answer questions on the record about their operations,” the head of the panel, U.S. Representative Peter DeFazio, a Democrat, said in his prepared remarks.

DeFazio added that the hearing “should also serve also a wake-up call to the companies that have flooded our roadways with disruptive technologies and investor capital that their days of operating with little public policy and regulatory oversight in the transportation space are coming to an end.”

He raised a number of issues, from safety to congestion to wages of drivers.

“Perhaps they don’t want to talk about what their model is doing to drive down wages and turn our transportation workforce from a skilled, trained pool of workers earning living wages to another casualty of the gig economy,” DeFazio said.

Earlier this week, he urged the companies’ chief executives in a letter to participate in the inquiry even as Uber and Lyft directed lawmakers to third-party industry associations.

DeFazio added “the tenuous existence of Uber and Lyft is literally fueled by millions of independent contractors who see their take home pay reduced drastically – below minimum wage in some states – as they are made to pay fees collected by the company, self-employment taxes, and costs associated with operating and maintaining their vehicles.”

He said the companies, which have reported substantial losses, “don’t make information about their process for deactivating dangerous drivers public. They don’t share data on the prevalence of assaults on their platforms. They don’t reveal details on how drivers are paid. What we do know is that both these companies are struggling since going public… Clearly, this business model is not sustainable.

Uber on Monday confirmed it had received DeFazio’s request.

Lyft said this week it would work with lawmakers and said the committee is reviewing “important topics that we take very seriously. We look forward to future discussions.”

The companies did not immediately comment Wednesday.

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