What Uber Going Legal in Toronto Means For Riders

A standoff between Toronto's taxi industry and Uber that included comparisons to ISIS and rush hour joyrides moved toward a resolution Tuesday night as Toronto city council decided to make the ride-sharing service legal.

Following a raucous debate that lasted hours, Toronto councillors voted 27-15 in favour of new regulations for taxis and Ubers that will attempt to level the playing field between them.

Mayor John Tory, who pushed to keep Uber in the city, tabled the lengthy list of measures based off recommendations by the city's Licensing and Standards Committee.

"The public wants to have choices, and they should have choices," Tory said, while Uber Canada General Manager Ian Black called it "a great day for the riders in the city of Toronto."

But what will the new regulations mean for the average rider?

VICE reached out to Sunil Johal, policy director at the University of Toronto's Mowat Centre School of Public Policy and Governance, to break down some of the key takeaways:

Increase to Uber base fare
Uber's base fare is going up from $2.50 to $3.25, which is the same as what taxis charge.

"That's obviously not in consumers' interest," said Johal, "but it kind of levels out that number between Uber and taxis."

Rates for both taxis and Ubers are based on a mix of time and kilometres, but riders in Toronto can save up to 50 percent by using the latter service.

Johal explained the city has no jurisdiction over Uber's charging scheme outside of the base fare, whereas it does regulate how cabs charge customers, so it's reasonable to expect that Uber will continue to be the cheaper option in most cases.

Discounts/surges for taxis
Cabs booked through a smartphone app will be allowed to enforce surge pricing during busy periods—for Uber, surge rates typically start at 1.1 times the normal rate. By allowing taxis to do the same, the city is allowing them to stay competitive. However, Johal said he wonders how effective it will be considering many cabs are hailed by hand or ordered by phone.

"It wouldn't surprise me if during the next TTC shutdown if magically a lot of taxi companies' phone lines all of a sudden experienced technical difficulties," Johal said.

Taxis will also be able to offer discounts, though it's not clear in what situation it would make sense to do so.

Less training for taxi drivers
The city is doing away with its requirement that taxi drivers undergo 17 days of training (CPR and First Aid was specifically scrapped), which Johal said might not be a bad thing.

"A lot of people felt they weren't getting good service from drivers who were going through that training service anyway," he said, adding the city is hoping a more competitive market will force drivers to up their customer-service game.

While taxis are currently required to have cameras installed, Tory said there should be further study before the city decides if the same is necessary for Ubers.

Johal said he thinks it's because taxi rides are a more anonymous experience, where riders and drivers don't have access to the same kind of background and rating system as with Uber.

Read more: Uber Drivers Tell Us About Their Worst Customers

Johal said the potential influx of competitors could push taxis to structure themselves more like Uber.

"You're going to see far more opportunities to book cars through smartphones than you will to call people up or hail down a cab on the street."

And even though Uber drivers will now need insurance to cover $2 million in damages/death/injuries, their rates are still likely to be much lower than what cabs pay.

"I think that will make it more attractive for people to be a ride-sharing driver rather than a traditional taxi driver."

Earlier this year, Edmonton became the first Canadian city to pass Uber-related bylaws but the service is now suspended there until the province makes insurance available to Uber drivers. Meanwhile, Calgary city council and Uber can't seem to agree on regulations that appease both parties; Mayor Naheed Nenshi was recently caught on camera calling Uber CEO Travis Kalanick a "dick." In Montreal, where Uber operates in a grey zone (it's common for riders to sit in the front seat to avoid scrutiny), taxi companies have filed an injunction against the company. There have been also been large-scale protests in the city, with taxi drivers reportedly egging Uber drivers and offices.

Johal cautioned that Toronto city council will likely have to revisit its rules, and there are bound to be corrections along the way, including potentially limiting the number of Ubers in the city due to issues like congestion.

"It's really hard right to know how these rules are going to play out in practice," he said. "It's very important the city in a year and in two years is assessing key performance indicators and making sure these rules are promoting the kind of fair accessible, safe system for taxis that we want in the city."

Follow Manisha Krishnan on Twitter.