Shortly after COVID-19 hit New York City and wreaked havoc upon the For-Hire Vehicle (FHV) industry, the members of the Board of Directors of the New York Independent Livery Driver Benefit Fund (Livery Fund) knew that many livery bases would not be able to pay their membership fees. Without membership in the Livery Fund, a livery base would have to procure a private workers’ compensation policy, which is much more expensive and typically cost-prohibitive. Without membership in the Livery Fund or a private workers’ compensation policy, a livery base would be out of compliance with the law, and therefore, subject not only to a “stop-work order” from the Workers’ Compensation Board, but also financial penalties of $2,000 for every ten days of no-insurance. As a result of these dire circumstances, the Board of the Livery Fund decided to use its reserve funds to pay the membership fees for all members.

This reserve fund is mandated to be held by law and used for Livery Fund purposes. Failure of the board to make these payments would have likely resulted in even more chaos upon the livery industry. At a time when the livery industry in New York City needs some help and stability, the last thing that the Board wanted to see is livery bases falling out of compliance with the law.

After nine months of COVID-19, the FHV industry did not quite recover. As a result, the Board of the Livery Fund decided to continue to pay the membership fees for all members for the entire calendar year of 2021. The legal requirement to retain a reserve means that certain monies can be reserved by the Livery Fund and used in emergency circumstances, but a certain amount of money has to be maintained by the Livery Fund in its reserve account. Accordingly, while the FHV industry still has not recovered from the effect that COVID-19 has had upon the industry, the Livery Fund will not be able to pay the fees for its members any further.

As of January 2022, the Livery Fund will no longer be paying membership fees. The next payment that will be due to the Livery Fund will be due on or around December 20, 2021, for membership effective January 1, 2022. Hereford Insurance Company, the insurance carrier and administrative partner for the Livery Fund, will be sending this invoice in the first week of December and will demonstrate the amount due from each base.

Please remember that if any livery base that is currently a member of the Livery Fund does not pay its membership fees for January 2022, then that base will have its membership in the Fund canceled. This will require the livery base to procure a full workers’ compensation policy for all of its affiliated drivers. If a livery base does not remain a member of the Fund and does not obtain full workers’ compensation policy, then as stated above, it will be in violation of the Workers’ Compensation Law. The financial penalties from the Workers’ Compensation Board are a personal liability of the livery base owner.

As General Counsel of the Livery Fund, it is my job to make sure the Livery Fund retains the proper reserve and remains compliant with Article 6G of the New York State Executive Law, the law that created the Livery Fund. We hope all livery bases understand that the Livery Fund, in connection with Hereford Insurance Company, has done all it can during this trying time to help each member livery base weather the ill effects that COVID-19 has had upon the livery industry.

As always, if any member livery base has any questions, you may contact us by using the web submission form at this link: