The clock is ticking on a threat by Uber and Lyft to pull out of Minneapolis on May 1 after the City Council this week overrode a mayoral veto of an ordinance laying out minimum compensation requirements for app-based drivers.
The current measure has few substantive differences from a plan that died last year after it was vetoed by Mayor Jacob Frey.
Last year’s veto override vote was 5-5 with three abstentions. This time, the vote was a veto-proof 10-3 in favor. There have been changes in the Council lineup since the earlier vote to sustain Frey’s first veto.
Lyft rapidly put out an unambiguous response about its plans.
“We are shutting down operations in Minneapolis when the law takes effect on May 1,” the statement provided to FreightWaves said. “We will continue to advocate for a statewide solution in Minnesota that balances the needs of riders and drivers and hope to return to Minneapolis as soon as possible.” There is legislation at the state level that would provide minimum pay levels, according to media reports in the city.
Several news agencies reported they had received a similar response from Uber, stating that Minneapolis will find itself as the only major city in the U.S. without Uber service on May 1.
Supporters celebrated online. Jamal Osman, a member of the City Council and a sponsor of the legislation, declared on X, formerly Twitter, that “[d]rivers are human beings with families, and they deserve dignified minimum wages like all other workers. Today’s vote showed Uber, Lyft, and the Mayor that the Minneapolis City Council will not allow the East African community, or any community, to be exploited for cheap labor.”
The office of the city auditor released a study in early February that put the cost of the mandate at approximately $15.57 an hour.
But that figure is not specified in the auditor’s report. Rather, the report calculated it on the basis of other numbers in the current ordinance as well as the one last fall when a veto was sustained.
Key provisions require that a driver for what the proposal called a “transportation network company (TNC)” be paid at least $1.40 per mile and 50 cents per minute for the time spent transporting a rider. That rate would be subject to annual revision.
If the calculation comes in at less than $5, the driver would be paid that minimum.
The law also mandates payment of $1.81 per mile if the driver is behind the wheel of a wheelchair-accessible vehicle, as well as the 51-cents-per-minute requirement or the $5 minimum.
A cancellation would require that 80% of the cancellation fee go to the driver. Tips would not be counted against the minimum compensation.
Various groups have been lining up in favor of or against the ordinance for weeks. In an opinion article published earlier this month in the Minneapolis Star Tribune, Dan Meyers spoke against the proposal from the perspective of disabled people. He said in the article that he had worked on a task force that sought to put together a minimum compensation package for TNCs.
“The ordinance the council proposes could nearly double the price of rides, making rideshare rides more expensive than a taxi in Manhattan and a luxury that only the wealthiest can afford,” Meyers wrote. “That would be devastating to the disability community, who often rely on rideshare to get to work, to medical appointments, to the grocery store. Rideshare services are critical for people with disabilities to enjoy full participation in the economy and in our communities.
In a report on the Uber and Lyft threats from Fox 9 in Minneapolis, a driver expressed skepticism about the threats.
“We’ve heard that many, many times. Different cities, different states,” driver Said Mohamed, according to the TV station. “They will never leave. Even if it was $5 per mile, they would never leave. They make enough money in this state and every other state.”
The auditor’s report did note that Seattle and New York City have minimum pay ordinances for TNC drivers, and have not stopped operating in either of those cities.
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Joe
jr233
If the price is too high, then people will stop using the service, there will be less fares for the drivers. and Uber will have to lower rates. But in the end it’s still better for the drivers who will at least be making a little bit more. The deal with Uber and Lyft is that they transfer the operating costs of their business to the drivers. And has it not occurred to you that maybe there aren’t enough jobs paying a living wage?
jr233
remember increasing costs without any chance of improved performance is always inflationary. and when government mandates wages and now independent businesses will result in rates no one will afford . much commented on the wheelchair but very few Ubers are that type since wheelchair vans are too expensive to buy new . and even taxi only few cities have new cabs if you look most taxi are rebuilt police cars almost ever ford crown vic taxi are old police cars
some chevies less so because not too many bought chev. dodge are usually too small and worn out . and thats the taxi fleets often put out by uber luft running illegally for yrs . the problem with the ride share, contract courier and similar things the drivers get all expense and told what pay will be so its job of last resort
you can never buy a brand new vehicle ever so you drive until the current on is junk hope to save money and get a better job not every job will be a career
like politicians they are not supposed to be a career and need to be term limited
Stephen Webster
Rick a new wheelchair van is over $71,000 cd or over $50,000 U S with a expectation to last about 300 000 km or 185,000 mile with a expectation of a repair costs equal to the new cost of the minivan
In Canada many nonprofit and gov run wheelchair provides better training and pay between $22 cd to $28 cd per hour plus overtime. You want disabled people to be driven around in older less safe vans by untrained drivers. This is often done by foreign (students ) workers who often do not have the right work permits.
Mel triggers all the old guys
The gig economy and its consequences have been a disaster for the human race. Gotta laugh at the corporate boot lickers who defend business models like this, “Get a bEttEr JoB iF yOu DoN’t lIkE it 🤡”
Harps
Rick… is a cab driver a real job? What constitutes a real job exactly? A side job should meet the minimum wage. It’s not even asking for a livable wage, just meet the hourly minimum. No matter the industry, there is someone that thinks everyone should be a slave, and the corporation should reap the rewards. Why defend the corporation? What a weird perspective.
Stephen webster
Reply to Rick a wheelchair van can cost over $52 000 U S or $70 ,000 cd many non Uber wheelchair transport companies and nonprofit pay between $22 cd and $28 cd plus medical and overtime and have special training. Why should someone new to the country be expected to work. For maybe half that or less after expenses driving a older less safe wheelchair accessible van without the proper safety equipment and training.
Rick
Good grief!!! It’s a side gig not a full time job. If we still had paperboys with home delivery,the loony left would try to make that a livable wage too…Get a real job if you need more money. What a bunch of crybaby losers.
Stephen webster
The Federal government in Canada is also looking at the same type of legislation. This bill should be the standard across all of the United States and Canada and Mexico
It reflects a real wage to support a person that often has a family. We should as this as a way to get more wheelchair access vans into the transport of of people along gov insurance like British Columbia and some other parts of Canada I believe.