Uber urges drivers to challenge NZTA illegality ruling in court

Ridesharing service company Uber says it would encourage Kiwi drivers facing enforcement action from the New Zealand Transport Agency for flouting the driver endorsement rules to challenge that in court.

The smartphone-based driver service dropped its requirements in April for drivers to have a passenger (P) endorsement for their licence or a certificate of fitness for their car even though the NZTA says it is illegal. At the same time it slashed fares by 20 percent, a move that has angered some of its driver partners.

"We want the judiciary to rule on this", said Uber public policy associate Ben Brooks at an Auckland hearing today on submissions for an inquiry by the Transport and Industrial Relations select committee into the future of New Zealand's mobility.

Uber offers drivers a fast-track system instead that authorises drivers in less than a week for just $20 and includes criminal and traffic conviction checks.

A government review on new rules for passenger services such as taxis, shuttles, and ridesharing apps has proposed treating them all alike but required drivers to still hold a P endorsement, which includes a police check.

Uber is still lobbying hard for a change, arguing the existing P-endorsement process is a relatively small fixed cost for full-time commercial drivers but is a disproportionately massive fixed cost for private drivers providing ancillary rides. "Unnecessary imposts will fundamentally limit the supply of partners and make ridesharing unviable," it said in a submission to the inquiry.

It wants a streamlined two-step P-endorsement system that would give applicants with no criminal record immediate authority to drive and complex applicants with criminal or driving history records referred for further assessment.

Around half of Uber's driver partners drive for less than 10 hours a week, logging on in times of high demand such as Friday and Saturday nights, and in New Zealand more than 80 percent of operators regard it as their secondary income.

Even with the proposed reforms under the ministry review it could cost almost $1500 and take between six to eight weeks to earn incidental income with your vehicle, Uber said. Brooks praised new legislation introduced in New South Wales that has cut the time and cost down to get drivers on the road and seven days and $45.

"That is the biggest problem here as far as we're concerned, how easy it is to get on the road," he said.

In a crackdown on illegal drivers, the NZTA has suspended one P endorsement, forced seven drivers off the road, issued 11 infringement notices, and given 34 formal warnings. The agency said it was investigating 11 other complaints about potential illegal services and has written letters to around 700 drivers it has information to indicate are considering taking on work as an Uber driver to remind them of the rules.

NZTA said as well as taking cars off the road, drivers without full endorsements could be fined up to $1,000.

"The enforcement action will ramp-up as more evidence is gathered and investigated," said NZTA acting general manager for access and use Leigh Mitchell.

Select committee member and Labour MP Iain Lees-Galloway asked Brooks and NZ operations manager Richard Menzies why Uber was continuing to run a business in a way that is illegal.

Brooks said "We're encouraging them to work that way. The NZTA is saying it's illegal and we're contesting that."

Lees-Galloway also asked whether Uber would cover the drivers' fines of the cost of any court action.

"I don't know how that would work but am happy to get you that information later," Brooks said.

Menzies also said Uber would "stand by our partners", though when asked later what that meant in practice, simply restated that it would "stand by them 100 percent".

Uber said it doesn't yet have sufficient passenger numbers in New Zealand to introduce its uberPool product which connects two more consenting riders travelling in the same direction or uberCommute which connects riders who drive regularly to work.

A mature ridesharing market reduces the number of active cars in a city by some 5 percent, it said. In New Zealand around two-thirds of the distance driven involves only the driver and a quarter only one passenger.

The ridesharing service has operated in New Zealand since 2014 and now claims 2,000 active driver partners and 150,000 active riders with 93 percent of trips having a wait time of under 10 minutes.

(BusinessDesk)