Cab drivers are subject to the livery laws of the cities where they work.
Cab drivers are responsible for transporting people between destinations, typically in busy urban areas. As an alternative to public transportation, taxi cabs give riders the option to leave their personal cars behind or live in a city without the need to own a car. Cab drivers come from all walks of life and must comply with state or city regulations intended to keep riders safe. A cab driver's salary can vary greatly depending on factors such as location and amount of business.
Wages
Most cab drivers don't earn hourly wages or annual salaries. Instead they make a wage that varies widely depending on the amount of business they do. Drivers collect their wages directly from riders, which means that an individual driver's pay comes in generally small, frequent portions. According to the U.S. Bureau of Labor Statistics, the median annual wage of a cab driver in 2008 was $21,550. However, some drivers earn less than $15,620 each year while the top 10 percent of drivers make more than $34,210.
Tips
A cab driver's wages consist of both fares and tips. Fares may be a subject of company or city regulation, with drivers only allowed to charge a certain rate depending on the distance traveled and the number of passengers. However, passengers may give tips in any amount. Cab drivers are required to report the full amount of their earnings, including tips, for tax purposes.
Employment Status
Cab drivers generally work as independent, self-employed drivers or contract with a taxi company. Drivers who work independently own their vehicles and the taxi licenses they need to be able to do business legally in a given city or state. Most drivers who can't afford a vehicle and the license instead rent cabs from taxi fleets. These drivers use the money they collect as fares both to pay rental fees and fund their own salaries. Drivers who collect hourly wages or annual salaries usually work as chauffeurs for limousine or car services rather than as cab drivers.
Considerations
A cab driver's salary reflects income above and beyond the cost of doing business. Drivers are responsible for buying fuel for their cabs, which gives drivers who own or rent hybrid-electric cabs an advantage. Drivers who own their own cabs must pay for maintenance and repairs, as well as inspections, insurance and vehicle registrations. Those who rent cabs usually pay maintenance fees in addition to rental fees.
Tags: amount business, annual salaries, driver salary, Drivers collect, drivers earn, hourly wages
