American online taxi hailing firm Uber has guaranteed its drivers a minimum peak-time and off-peak pay to shield them from any loss of income arising from a passenger fare price cut that took effect in Nairobi on Thursday.
Uber drivers will earn an indemnity of between Sh500 and Sh450 for every peak and off-peak hour respectively that they fail to get ride requests when their Uber gadgets are online.
Uber will top up drivers’ earnings during the off-peak hours where rides requested are worth less than the set compensation minimum.
To qualify for compensation, drivers must achieve a minimum requirement of being online (on duty) within the set hours, make one trip every two working hours and have taken 90 per cent of ride requests within their tenure.
Uber Kenya says the peak hours are defined by demand across the seven days of the week. The firm says that there are 60 high potential hours in Nairobi when most client requests are recorded.
“In order to boost the drivers, we have put a value to the hours by coming up with peak hours when there is high demand, we have put a guarantee that if a driver is working and they do not get a single ride request, Uber will give the driver Sh500 as compensation for that hour or, for instance, if it is the off-pick periods and a driver makes Sh200 we will top up with Sh250,” said Uber Kenya country manager Nate Anderson.
The tech firm says it has put systems in place to avoid cases of fraud and is capable of pulling data from gadgets and analysing it to authenticate drivers’ claims.
“We have few requirements that we communicated to the drivers. We generally expect them to uphold integrity at all time,” he said. Uber slashed its charges in Nairobi by nearly half yesterday in response to mounting competition from local rivals.
The new charges will see Uber charge its clients a rate of Sh35 per kilometre down from Sh60. The taxi-hailing firm also reduced its charges per minute by Sh1 to Sh3 and cut the pricing of short rides by Sh100 to Sh200. Base fare of Sh100 is unchanged.
“We believe these changes will help, but while the city adjusts to the new prices, we are putting in place minimum payment guarantees for drivers to ensure they don’t lose out. And if the amount they make on the road isn’t what we expect, we will reassess this price change,” he said, adding that Uber has 100,000 unique visitors every month in Kenya and the firm is aiming to attract a new rider base that could not afford before and increase usage.
Nairobi is registering increased tax-hailing apps, but Uber says that the price cut is not a reaction to the mounting competition. The firm has stopped signing up new cars “to manage demand.”