Carpooling Decision in Canada: No Compensation Allowed For Inter-City Trips

My wife won’t watch the news with me anymore. Apparently, my habit of talking back to the TV during reports on court cases is a little less than endearing. I just can’t help it, though- media reports on legal issues tend to range from slightly misleading to blatantly incorrect, and that drives me batty.

TechCrunch posted a piece regarding a decision by the Ontario Highway Transport Board to shut down, a web-based ride sharing service that was operating in Ontario. Here’s how it was summarized:

“The bus companies freaked and sued under an Ontario law that limits carpoolers to traveling only from home to work and back, riding with the same driver every day and paying only by the week, among other restrictions. This is despite the fact that the government has spent “billions” in carpooling lanes.”

The article also quoted from PickupPal:

“Well we got our ruling from the Ontario Highway Transportation Board (OHTB) and they say that it is illegal to Rideshare in Ontario, (here is the official decision [PDF 0.98 MB]).

The only way you can ride with someone is if you meet ALL of the following extremely impractical set of specific criteria:

* You must travel from home to work only – (Not Home to School, or Home to the Hospital or the Airport)

* You cannot cross municipal boundaries – (Live outside the city and drive in – sorry you cannot share the ride with your neighbour)

* You must ride with the same driver each day – (Want to mix it up go with one person one day and another person another day – no sorry cannot do that – must be same person each day)

* You must pay the driver no more frequently than weekly – (Neighbour drives you to work better not pay her right away just in case she drives you later on in the week)”

Put simply, the summaries provided by TechCrunch and PickupPal are wrong. They might make for good inflammatory blogging, but so do stories about unicorns attacking leprechauns. Neither have a basis in reality. Each and every point in the PickupPal summary quoted above is inaccurate, half truths at best and intentional deceptions at worst.

Here’s how the law actually works- the starting point is that you’re more or less free to drive whomever you want, wherever you want. The iron fist of the Ontario government (in the form of the Public Vehicles Act, or PVA) only creeps in when you carry passengers between cities or towns AND you’re receiving compensation in exchange. If you’re carpooling solely within a single city, or if you’re not being compensated for driving, there’s no issue with the PVA. I suspect this would cover the majority of carpoolers, who arrange to share rides with co-workers, neighbors and friends and take turns driving back and forth. Nothing has changed for these people, and nothing will.

But what happens if you’re crossing municipal boundaries and being compensated for doing so, either through money, coffee, sex, drugs, or rock n’ roll? This is where the definition of a “carpool vehicle” kicks in to save you, as the PVA provides that it doesn’t apply to any carpool vehicle within this definition. If you fit within this exception, you’re a-okay. If not, you’re screwed. To be considered a carpool vehicle, you must:

  • Have a seating capacity of less than 12 people (buses and Canyoneros need not apply);
  • Not be paid by your passengers more than once a week (payment “per trip” is not permitted); and
  • Not take passengers on any more than one round trip per day (a trip to work, to the mall, to the grocery store and back home is okay; a series of trips to and fro isn’t).

PickupPal got in trouble because it was arranging transportation between cities (in fact, between provinces in some cases) in exchange for compensation on a “per trip” basis, and the vehicles being used were therefore considered to be “public vehicles”. Their troubles didn’t arise because of a conspiracy against carpooling, nor did it come from an obscure interpretation of some antiquated laws. The OHTB has dealt with this issue before (and fairly recently, at that) and the law is far from vague.

Let’s be clear: you can still carpool to your heart’s delight. You can drive your neighbor to the airport and he can buy you a coffee. You can drive your neighbor to Montreal and he can buy you a steak, or a whole cow, for that matter. Or cash in lieu of cattle, whatever. What you can’t do is receive compensation for individual rides for inter-city trips. At that point you’re no longer ride sharing, you’re ride selling and operating a public transportation service. If that’s what you want to do, you need to jump through all the hoops that every other public transportation service has to go through, and the public has a right to expect that individuals operating such ventures are properly insured, inspected, and licensed. The Public Vehicles Act isn’t an attack on carpooling, it’s an attempt to control unscrupulous drivers seeking to make a quick buck at the cost of public safety.

That is not to say that the current law is perfect- it’s not, and it may need to be updated to make allowances for ride sharing services that fall outside the current exemptions, while maintaining public protections. That’s why the Ontario government has already introduced legislation to make such allowances and permit ride sharing provided that the driver is only collecting money to cover expenses, not to turn a profit. However, even under a revised law it is likely that PickupPal will encounter trouble unless it tightens up its service quite a bit.

PickupPal offers a unique service that is useful and needed across the country, but it needs to operate within the existing legal framework, and where this is unsatisfactory, it needs to work to have it changed. Ironically, I fully support PickupPal and think that the government needs to address this issue. However, spreading falsehoods and misinformation about the current law does little to help its case. Doing so stifles informed debate on the subject, causes confusion and uncertainty, and annoys Solicitor Fluffypants to boot.

[thanks to mike licht and money grubbing lawyer via cc]