Flat Rates In VFH Vehicles
February 1, 2019
Province of Ontario (“Province”) and City of Toronto (“City”) Governments
Setting flat rates for taxicabs is a very slippery slope on a number of fronts and needs to be disallowed and replaced with the wording approximate rates and run the meter as required by the by-law. A taxicab, by mandate, must be equipped with a meter and the charges applied to the consumer are contained in the Toronto Municipal Code, Chapter 546, Licensing, Vehicles-for-Hire, Appendix A, Taxicab Tariff and Charges, so use it and stop the conflicts that often arise when flat rates are used to price a taxicab trip.
These meters are programmed to charge the consumer by a combination of time and distance, where most flat rates are given on distance alone. Flat rates, because the person quoting the rate wouldn’t know the following conditions from pick up to drop off time, road conditions, traffic, possible accidents, road construction or the required time to complete the trip, are often substantially underquoted and the driver is not receiving what Tariff A guarantees he or she is supposed to be paid.
Upon reviewing Chapter 546 and going back to see what the flat rates were in the previous governing by-law, Chapter 545, it is pretty evident there were a few emails, phone calls and closed door meetings between the City’s taxicab brokers and the ML&S as there has been a change applied to Chapter 546 that was part of Chapter 545, but not brought forward, involving taxicab driver protection when taxicab brokerages are quoting a flat rate for charge account customers.
“Toronto Municipal Code – Chapter 545 – Licensing – Article VII – Taxicab Brokers
545-130 – Flat Rates
A. A taxicab broker may enter into a flat rate arrangement with charge account customers, provided that the taxicab broker shall not pay any taxicab driver who services a flat rate any less or significantly more than the meter rate for that call.”
This section gave the taxicab driver protection against the taxicab broker underquoting the meter rate, which happens more than you think. I experienced it once myself a few years ago when I worked in a taxicab brokerage when the flat rate given to me to service a charge account customer was $14 underquoted due to rush hour and very heavy traffic over the distance I had to go to deliver the package.
When I asked for the dispatcher to call the customer and adjust the rate, he refused. When I contacted the brokerage manger to do the same, he refused. I eventually had to contact the ML&S who informed the taxicab company I was entitled to the difference and they begrudgingly paid me. A couple of dollars would not have bothered me, but $14 was too much to lose considering the extra time required to do the order and the additional time to return to my regular service areas.
“B. – Any flat rate arrangements entered into by a taxicab broker with charge account customers must, for trips originating within the City of Toronto, excluding the area bounded by Kipling Avenue on the east; Finch Avenue on the north; Eglinton Avenue on the south and the western boundary of the City of Toronto, and terminating at Lester B. Pearson International Airport, be in accordance with Appendix M, Taxi Tariffs from the City of Toronto to Lester B. Pearson International Airport.
545-150 – Rates and Fares
E. – Taximeters to be placed in operation; flat rates
When a trip originates within the City of Toronto, excluding the area bounded by Kipling Ave on the east, Finch Ave on the north, Eglinton Ave on the south and the western boundary of the City of Toronto, and terminates at Lester B. Pearson International Airport, the passenger may be charged a flat rate equal to the rate applicable in Appendix M, Taxi Tariffs from the City of Toronto to Lester B. Pearson International Airport, for that trip or the passenger may elect to pay the taximeter rate, whatever is lower.”
545-130 B airport flat rates, dealt only with charge account customers and gave no option to pay a meter rate if it was lower than the quoted flat rate. 545-150 airport flat rates deal with all other customers and includes the option of accepting the flat rate or the meter rate if lower.
Appendix M, flat rates to Pearson Airport were in conflict with Appendix C, Tariff A, Taxicab Rates and Fares, which is what a taxicab driver should have been paid as these flat rates are usually lower than the meter rates and why these rates were illegal in my opinion.
Now, let’s take a look at the new by-law that came into effect on July 15, 2016.
“Toronto Municipal Code – Chapter 546 – Licensing of Vehicles-for-Hire
Article 3 – Taxicab Rates and Fares – 546-20 – Flat fares and Airport Fares
A. – If a trip destination is located more than 5 kilometres beyond Toronto, the vehicle-for-hire driver operating a taxicab and a passenger may agree before the start of the trip to a flat fare to be charged, but the driver shall operate the trip meter as required by s/s 546-23.”
I have never understood how the City feels it has the right to legislate one inch outside of their municipal boundaries or if I am allowed to set a flat rate initiating within my City’s boundaries that is going outside of those boundaries, why am I not able to set a flat rate for a fare originating and staying within the City’s boundaries, as long as the meter is in the recording position?
“B. – A taxicab broker may enter into a flat rate fare agreement with charge account customers and the vehicle-for-hire driver shall charge the passenger such flat rate, but the driver shall operate the vehicle’s trip meter as required by s/s 546-23.”
Notice the difference in this section compared to 545-130 A, as to what was left out of 546-20 B, which was, “shall not pay any taxicab driver who services a flat rate any less or significantly more than the meter rate for that call.
So, if the trip according to the meter runs significantly more than the quoted flat rate due to the numerous situations I previously mentioned, the driver has no recourse to get paid what the meter says and now has to eat the difference, which is in conflict with the by-law’s tariff.
“C. When a taxicab trip originates within Toronto, excluding the area bounded by Kipling Avenue on the east; Finch Avenue on the north; Eglinton Avenue on the south, and the western boundary of Toronto, and terminates at Lester B. Pearson International Airport, and the passenger has hailed the taxicab or commenced their trip at a taxicab stand, the passenger may elect to pay either the applicable flat fare found in Appendix C, Taxi Tariffs to Lester B. Pearson International Airport or the fare calculated by the trip meter at the tariff, whichever is lower.”
I noted unlike Chapter 545, in Chapter 546 has no specific airport flat rate section for brokerage charge account customers as it has all been rolled into one section, 546-20 C. There was one change made to the flat rates to Pearson Airport from Chapter 545-150 E to Chapter 546-20 C. 545 stated, “the passenger may be charged” and 546 states “the passenger has hailed the taxicab or commenced their trip at a taxicab stand.”
Since 546-20 C makes no mention of the flat rate airport fee applying to a passenger who calls or has made previous arrangements for their trip to the airport and since that is where I get 99.99% of my airport trips, this won’t apply to me anyway and even if it did, I would disregard the flat rate airport fee as it is in conflict with the by-law’s tariff.
“Article 10 – Private Transportation Companies (“PTC”)”
On July 1, 2017, the Excise Tax Act’s definition of a taxi business was changed:
“(b) – A business carried on in Canada by a person of transporting passengers for fares by motor vehicle – being a vehicle that would be an automobile as defined in subsection 248(1) of the Income Tax Act, if that definition were read without reference to “motor Vehicle acquired primarily for use as a taxi” in its paragraph (c) and without reference to it paragraph (e) – and without a particular municipality and its environs if the transportation is arranged or coordinated through an electronic platform or system”
The flat rate mandates given to a taxicab brokerage as stated in 546-20 B are in conflict with 546-21. 546-20 B gives no option for a driver to refuse the trip if the driver feels the trip is underquoted, yet in 546-21 that also deals with a taxicab broker reducing the tariff, does give the driver the right to refuse a rate lower than the tariff.
Seeing as taxicabs, limousines and PTC vehicles are also defined in the Act as operating a taxi business, why doesn’t Appendix C, Taxicab Tariffs to Lester B. Pearson International Airport, apply to PTC drivers as well?
Does this not show the City is showing favouritism and abusing its licensing authority by not requiring PTC’s and their drivers to abide by Appendix C and therefore in violation of the Charter of Rights and Freedoms, Equality Rights?
The idea of flat rates is antiquated in today’s vehicle-for-hire industry, as there are too many variables for the person who is asked to give the flat rate as there were when flat rates came into being many years ago.
If flat rates are going to be allowed to continue, other than the driver quoting his or her own flat rate, which they would be duty bound to stand behind, the driver should always have the option to refuse the run if he or she believes it is substantially underquoted, including Chapter 546-122 Transitional provisions, Appendix C, Taxicab Tariffs to Lester B. Pearson International Airport.
The City has enacted 546-122, Transitional Provisions, Appendix A, Taxicab Tariffs and Charges for a purpose, which was to ensure the consumer was to be charged a fair price for the taxicab ride and that the taxicab driver was to be paid a fair rate for his or her services. Flat rates go against that principle in many instances as they are often underquoted. Obviously, Appendix C is in conflict with Appendix A and needs to be removed from the by-law.
Gerald H. Manley
105 Rowena Dr. Suite 405
Canada, M3A 1R2
Toronto Taxi Owner – Licence Number 416