New Uber Tipping Scam: How Drivers Are Manipulating Riders For More Money

When Uber launched, customers weren’t supposed to tip their drivers. The drivers, the app promised, were paid well enough that the fare ‘included the tip.’ And the experience was seamless – just get out of the vehicle.

Drivers wanted to earn more, and Uber agreed to support tipping in its app. But because customers started paying more to drivers through tips, Uber reduced how much they paid to drivers.

  • If a driver will take a ride for $20, it doesn’t matter whether the customer pays Uber and Uber pays the driver $20 or if the customer pays Uber and then adds $5 and Uber pays the driver $20.

  • Uber cares that it has enough drivers to satisfy ride requests. It will pay drivers the least amount that it can while doing this.

On a given ride, though, the more a customer tips the more the driver will make. So drivers do want riders to tip. It’s just that once that happens in the aggregate, Uber’s compensation model adjusts.

Here’s an Uber tipping scam you need to watch out for. Tipping is still voluntary in the app, and there is no automatic tip for rides. But some drivers, apparently, are warning riders about an automatic “30% tip” if they don’t choose their own tip. That motivates riders to enter a tip.

Received this before pickup?
byu/empty40oz inuber

The biggest reason drivers don’t get tipped isn’t that the rider prefers a $0 tip, it’s that they don’t return to the app to do it. So drivers who get passengers into the app to select a tip could be getting them to tip $0. More likely, though, they’re getting the rider to leave an amount they’d have left if only they’d returned to the app. And they’ve set the base expectation at 30% – people are motivated to go below that, but maybe feel bad tipping only 10% so tip 15% or 20% instead.

About Gary Leff

Gary Leff is one of the foremost experts in the field of miles, points, and frequent business travel - a topic he has covered since 2002. Co-founder of frequent flyer community, emcee of the Freddie Awards, and named one of the "World's Top Travel Experts" by Conde' Nast Traveler (2010-Present) Gary has been a guest on most major news media, profiled in several top print publications, and published broadly on the topic of consumer loyalty. More About Gary »

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  1. @Kevin – I live in a very busy city where traffic is always heavy and parking is sparse and expensive. I can generally receive 30 trip requests within a 5 min period. I have the ability to be selective where not all markets could I do this. I know my market very well and know how to maximize my ride count.

    You are correct, I may be missing out on good people who tip, but there is no way to know. If I can make more by controlling where passengers destinations take me, why would I accept trips going into higher traffic, difficult driving and gamble on the hope that someone will tip me? Statistically, people won’t anyways no matter what level of service I provide, so why should I make my life more difficult? Passengers always will find a way to justify not tipping. It’s a social contract that we have in the US, like it or not. Just be prepared for the consequences of breaking that contract.

  2. @Gary Leff – Btw your article is based on one person who did this. I don’t see much proof that you can even say “some” drivers are participating in; just one. So many armchair experts on the rideshare business who assume that “because they too can drive a vehicle,” that they know this business. Most in the comments are clueless as to what it takes.

  3. Drove years for Uber and Lyft. Both companies have cut amounts paid to drivers. In beginning it was a 80/20 split. Then 70/ 30 now at times it is a fraction of the ride. Ever since going public.
    More customers complain, add stops that pay pennies vs time wasted. The complaints can have you blocked/ fired for no reason. Riders want free rides. We are powerless. When started only rides in certain areas/ distance maximum. Now expect rides that people should be flying to locations. All then out of area and out of hours so driving empty. So lost any money might have made. Please learn the business before you write on the subject.

  4. Fun fact – Not one puker I’ve had, has ever left a tip. So apparently cleaning someone else’s vomit up isn’t “going above and beyond” enough either.

Comments are closed.