Uber reaches its tipping point

As Uber struggles to overhaul its turbulent workplace culture and improve a public image tarnished by a series of scandals, the company is also reaching out to a key constituent: drivers. Notably, Uber will allow drivers to accept tips from riders.

Uber is embarking on a 180-day campaign of what it calls “meaningful changes and improvements” for drivers. Starting today, in-app tipping will be available in Seattle, Minneapolis, and Houston, with the goal of expanding the feature to all U.S. cities by the end of July. Service fees will not be deducted from tips, Uber explained in a blog post announcing the changes.

Riders will have 30 days to tip drivers, while customers receiving deliveries from UberEats will have a week to make their tips. Uber also vowed to shorten the no-fee cancellation window to two minutes from five minutes and to pay for time spent waiting for tardy riders beginning two minutes after arrival. Other changes include injury-protection insurance and an extra $2-per-trip fare for teen accounts.

“This is just the beginning,” said the post, authored by Rachel Holt, head of U.S. operations, and Aaron Schildkrout, head of driver experience. “Over the next 180 days we are committed to making driving with Uber better than ever.”

Uber drivers have long pushed for the ability to receive in-app tips. While some riders have paid cash tips despite Uber’s longtime no-tip policy, Lyft has allowed its riders to tip drivers as part of the payment process. Uber’s change of heart may represent an attempt to get ahead of changes proposed by some cities.

In April, the Independent Driver Guild persuaded New York City’s Taxi and Limousine Commission to propose a rule requiring in-app tipping as an option in the city. The IDG said a survey of drivers cited tipping as their chief concern with Uber. After Uber declined to change its tipping policy, the IDG launched an campaign to pressure the company, including an online petition that has collected more than 11,000 signatures.

Lyft said this week its drivers have earned a collective $250 million in tips. The IDG has estimated that in New York alone, drivers for Uber and other services could earn $300 million in tips annually.