Lyft and Uber have said they will halt operations in Minneapolis because of a new city ordinance that increases wages for app-based drivers
Lyft and Uber have said they will halt operations in Minneapolis because of a new city ordinance that increase wages for app-based drivers, the latest salvo in a longtime fight between gig economy workers and the tech giants.
The city’s council vote Thursday overrode a mayoral veto of the measure and means ride-hailing companies will have to pay drivers the equivalent of the local minimum wage of $15.57 an hour. It’s not the first time members of the city council have advocated for a driver pay raise, nor is the issue exclusive to the city or the state.
Here’s what to know about the Minneapolis measure and gig worker negotiations across the country:
The City Council’s measure requires requires ride-hailing companies to pay drivers at least $1.40 per mile and $0.51 per minute for the time spent transporting a rider — or $5 per ride, whichever is greater. Tips are excluded. In the event of a multi-city trip, that only applies to the portion that takes place within Minneapolis.
Supporters said the measure prioritizes workers’ rights over corporate greed.
“This is a David and Goliath story,” council member Robin Wonsley, who helped author the policy, said in a statement. “Regular working-class people took on two corporate giants and their political allies, and won.”
Fellow council member Jamal Osman said it will keep the companies from exploiting the city’s East African community for cheap labor.
Lyft and Uber both said they will stop operating in Minneapolis when the ordinance takes effect May 1.
Lyft called the ordinance “deeply flawed,” saying in a statement that it supports a minimum earning standard for drivers but not the one passed by the council.
“This ordinance makes our operations unsustainable,” Lyft said.
Josh Gold, Uber’s senior director of public affairs, said in a statement that the result will be thousands of people out of work and many riders stranded.
