Lawmakers look to end ‘common carrier’ exemption for ride-share companies

[May 10, 2023]  By NIKA SCHOONOVER
Capitol News Illinois
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SPRINGFIELD – Ride-share companies such as Uber and Lyft would be subject to the same level of liability as other forms of public transportation under a measure moving through the General Assembly.

House Bill 2231 would classify ride-shares as “common carriers,” meaning the companies can be held liable, rather than just the drivers, for accidents or injuries to passengers. Currently in Illinois, “common carriers” include taxicabs, railways and elevators, among others.

But the state’s 2014 Transportation Network Providers Act specifically exempted ride-share companies from being deemed “common carriers.” The law stated ride-shares, defined as Transportation Network Companies, and their drivers “are not common carriers, contract carriers or motor carriers, as defined by applicable State law, nor do they provide taxicab or for-hire vehicle service.”

An amendment to HB 2231 would deem that common carrier exemption “inoperative” as of Jan. 1, 2024. The amended version passed the Senate on partisan lines last week, sending it back to the House for a concurrence vote. A previous version passed the House on partisan lines in March.

Under the amended HB 2231, the entire Transportation Network Provider Act would be repealed on Sept. 1, 2028, extending its review period from one year to nearly five years.

Bill sponsor Sen. Robert Martwick, D-Chicago, said the amendment changed some opponents’ positions on the legislation to neutral. Lyft, in particular, has shifted its stance as a result of the amendment, Martwick said.

“They had asked for a delayed effective date instead of being effective immediately…and that moved them to neutral,” Martwick said in an interview.

Uber, on the other hand, still opposes the bill. The company this week sent a letter to Jaime Harrison, Democratic National Committee Chair, in light of the DNC’s decision to hold the Democratic National Convention in Chicago next year.

Uber’s letter claimed the measure could increase costs for riders and increase eligibility requirements for drivers, despite no mention of this in the legislation.

The company also claimed the common carrier classification could increase ridership costs and create unspecified “barriers” for drivers joining the company.

“We know that planning for the Convention is already well underway, and we don’t want you caught off guard if the availability of on-demand transportation is less than anticipated as a result of the new law,” Josh Gold, senior director of policy and communications at Uber, wrote in the letter. “Our hope is that drivers and riders will continue their use of our app as normal. However...we have significant concerns about how it could affect the reliability of our app.”

According to POLITICO, the company also launched a six-figure radio advertising campaign specifically opposing the legislation, saying it would enable “frivolous lawsuits,” which would increase costs for consumers.

The Illinois Chamber of Commerce, once a strong opponent of the bill, said the amendment alleviated some of their concerns.

Clark Kaericher, senior vice president of government affairs at the Illinois Chamber, said the amended measure ensures ride-share companies don’t have to fight for the right to keep conducting business in Illinois each year.

State Sen. Rob Martwick is pictured on the floor of the Illinois Senate. He is the lead sponsor of a bill that would repeal an exemption shielding ride-share companies from certain liabilities for passenger safety. (Capitol News Illinois photo by Jerry Nowicki)

“For the last several years, they’ve just been granted a one-year extension,” Kaericher said. “And so every May, they’ve had to spend a lot of time and resources convincing the [General Assembly] to give them another extension.

Despite the amendment lowering the measure on the Chamber’s priority list, Kaericher said his organization still has concerns about the downstream effects of possible increased costs on safety.

“This bill is going to drive up the cost of Uber and I think that’s undisputed,” Kaericher said. “And what we’re worried (about) at the Chamber is that people are going to leave their local watering hole or restaurant, they’re going to pull up the app and they’re going to get sticker shock, and they’re going to think to themselves, maybe I’m not that bad and they’re going to drive and we’re going to see tragedies as a result.”

The Illinois Trial Lawyers Association, a supporter of the bill, pushed back against the concern over costs.

“Taxicab companies and their drivers have been considered common carriers basically forever in Illinois, and they were able to make a living and make a profit and transport passengers around,” Illinois Trial Lawyers Association President Pat Salvi Jr. said in an interview. “Ride-share companies can do the same. There’s no reason why ride-share companies should not be considered common carriers just like taxicabs, buses, trains, planes, and other modes of transportation.”

According to Crain's Chicago Business, the average fare for Ubers in Chicago increased by 80 percent and by 73 percent for Lyft since 2019. According to the same report, the average fare for taxis increased by 50 percent.

The measure was prompted out of a concern for rider safety, particularly after an Illinois Supreme Court case that was settled out of court in January 2022. The case’s prior appellate court opinion affirmed ride-share companies’ exemption from the common carrier status after a Lyft driver allegedly raped a passenger in 2017.

The alleged rape occurred in Chicago, when a woman identified only as Jane Doe hailed a Lyft after a night out with her friends. The Lyft driver picked her up and, at some point during the ride, Doe fell asleep. The driver then drove to a secluded alley where he brandished a knife, zip-tied her hands and repeatedly sexually assaulted her, according to a court filing in the case that was settled in 2022.

Despite Doe’s argument that ride-share companies such as Lyft should be held to the same liability standard as established common carriers, the appellate court upheld the exemption because of the specificity of the statute. The case was settled out of court before the Supreme Court could rule on it.

Supporters of the bill say this measure would allow riders to have an added level of safety when riding with companies such as Uber and Lyft.

“If something does happen, where a passenger is harmed and it’s the fault of one of the ride-share company’s drivers…that injured individual will have a better chance at getting redress for what’s happened to him or her,” Salvi said. “And that’s both in the context of a crash, as well as the context of those very tragic stories we’ve heard where a ride-share driver has assaulted or sexually assaulted a passenger.”

Capitol News Illinois is a nonprofit, nonpartisan news service covering state government. It is distributed to hundreds of print and broadcast outlets statewide. It is funded primarily by the Illinois Press Foundation and the Robert R. McCormick Foundation, along with major contributions from the Illinois Broadcasters Foundation and Southern Illinois Editorial Association.