Cab companies agreed to reduce management fees for drivers in the southwestern Chongqing municipality, following a strike earlier this month.

The companies promised drivers they would pay 50 yuan (US7.31) less per day in fees.

It can cost drivers 300 to 500 yuan a day to use a cab from a company. Licensed drivers complained that was too much, said Li Jun, executive vice chairman of the Chongqing federation of trade unions on Wednesday.

The agreement is retroactively effective since November 5, two days after the strike broke out in the downtown area of the country's fourth largest city.

It comes with a stipulation. Drivers will only have their fee reduced after performance evaluations.

According to Li, the federation invited 10 cab company representatives and 21 driver representatives to negotiate management fees. The driver still must pay the company even if he or she fails to earn the daily fee.

Cabbies showed support for the new agreement.

"I'm happy to hear the news, but we deserve it (the reduction)," said Liu Rencheng, a taxi driver from the privately-owned Yuqiang taxi company. Yuqiang is one of the eight major taxi companies in Chongqing. It owns more than 1,000 cabs.

Under the new policy, Yu and his partner, who run the same taxi in two shifts, can earned an extra 25 yuan a day if neither have serious traffic violations or passenger complaints.

"Usually, taxi drivers in Chongqing work for 10 to 20 days a month and many of them share a taxi," said Liu. "Theoretically, the new policy could bring in another 250 yuan to 1000 yuan, which is inspiring, especially when the economy is suffering."

Known as the "mountain city", Chongqing, unlike other Chinese cities, has very few bicycles. Cabs are the most common mode of transport after buses.

The municipality has 16,000 licensed cabs, with almost 9,000 in main urban zones.

Licensed drivers launched a two-day strike starting November 3 to protest several issues, including insufficient supplies of compressed natural gas (CNG), which fuels most cabs in the city, competition from unlicensed cabs, high fines for traffic violations and the unfair division of fares between drivers and companies.

The strike became violent as some drivers gathered on business streets to stop working cabs.

On November 10, Chongqing launched a campaign to crack down on unlicensed cabs. Traffic authorities and police increased patrols at transport hubs.

Illegal drivers will be fined 30,000 yuan (about US$4,412) to 100,000 yuan. Their illegal earnings will be confiscated.

The city government also promised to increase CNG supplies.

Cabbies in the suburban district of Yongchuan, who didn't take part in strike, staged a short service stoppage on Wednesday to protest a government plan to increase the number of taxis.

With a population of 310,000, the Yongchuan District, about 60km west of the city center, planned to increase the number of cabs from 300 to 400.

The cabbies returned to work by about 1:30 PM in response to requests from local government officials.

(Xinhua News Agency November 20, 2008)