Minneapolis approves measure to boost pay for Uber, Lyft drivers

Updated: 12:24 p.m.

The Minneapolis City Council on Thursday passed a policy requiring higher pay and more workplace protections for rideshare drivers operating in the city, although it faces a possible veto from Minneapolis Mayor Jacob Frey, who had asked the council to delay the vote. 

The ordinance passed 7-5 despite threats from rideshare companies Uber and Lyft threatening to stop operating in the city if the provision was put in place. 

Council Members Robin Wonsley, Jason Chavez, Jamal Osman, Jeremiah Ellison, Andrea Jenkins, Elliott Payne and Aisha Chughtai voted for the proposal. It was opposed by council members Linea Palmisano, LaTrisha Vetaw, Michael Rainville, Emily Koski and Andrew Johnson. Council Member Lisa Goodman was absent.

The proposal would set minimum compensation for drivers and create a process for drivers to appeal after they’re deactivated. It would also ban the use of gift cards for rides, which drivers said are often exploited to commit crimes against drivers. 

In an email to the Minneapolis City Council, a spokesperson for Lyft argued that the policy would make fares too expensive in the city. Following the vote, Lyft reiterated its concerns about what the measure would mean for riders.

“We support a minimum earning standard for drivers, but it should be part of a broader statewide solution that also protects driver independence,” said senior communications manager CJ Macklin. “That's why we urge Mayor Frey to veto this bill and instead allow time for the state's rideshare task force to complete its research.”

Uber sent a message to customers asking them to lobby the mayor and council members to oppose the policy. The companies previously said they’d stop serving the city after the policy went into effect in January. 

In a letter to council members before the vote, Frey said he shared his concerns about drivers’ working conditions but that “we must allow more time for deliberation.” 

“We need both additional data and conversations to be had to ensure the essential safety and well-being of rideshare drivers and riders alike,” Frey wrote to council members. 

Frey asked the council to delay the effective date of the ordinance until after the upcoming legislative session. A state working group is tasked with making legislative recommendations on the issue by January. Rideshare drivers had pressed the council to take action after a similar bill at the state level was vetoed by Gov. Tim Walz. 

Council Member Robin Wonsley argued that city staff are prepared to implement the policy starting in January, and that it should not be delayed. 

“It is backed by data and it has been developed by experts, and it is a great opportunity for Minneapolis to stand with workers and to lead the state,” Wonsley said. ”We should vote on that today, not next year, because our drivers need action today, not next year.”  

Johnson said he’s concerned the policy would be implemented at the same time that the working group’s recommendations from the state are due. Johnson said he would support city action if the State Legislature doesn’t take action next session. 

“The mayor has laid out concerns, and signaled, at least in my reading of the letter, here’s the path to approval,” Johnson said, arguing that it would be challenging for the council to override a possible veto from the mayor. “If you want to ultimately get this passed sooner than later, I’d recommend that collaboration directly with the mayor.” 

Council Member Elliott Payne argued that the proposal is not about the legislative process, but about whether the council supports workers rights. 

“The pragmatic approach is to look at history. This country is built on worker exploitation,” Payne said. “The future of this platform is driving down wages to poverty levels while increasing rates on customers.” 

Council Member LaTrisha Vetaw said the issue was “too politicized” and “performative.” 

“We all want the same thing for our workers,” Vetaw said. “We want them to be protected, we want them to earn a living wage and more than anything we want to get it right.” 

A proposal by Johnson to send the proposal back to committee failed by a 5 to 7 vote with Council Member Lisa Goodman absent.

Under the proposal drivers would be paid $1.40 a mile and 51 cents a minute for rides, which would be automatically adjusted each year in the same way the city’s minimum wage increases. It would also require drivers to get 80 percent of the fees when a ride is canceled, 80 percent of a surcharge and a clear receipt from each ride showing total compensation. 

The mayor also expressed concern about the process for deactivating drivers, the city creation of a driver center and the broad ban on gift cards, which he said “may have unintended consequences, especially for our residents who need assistance the most.”  

The policy would also require that drivers be deactivated if they are convicted of certain crimes, including murder, stalking or criminal sexual conduct. The driver must be given a note of deactivation at least five days before it occurs.  

After the vote, a spokesperson for Frey said in a statement that he has deep concerns about how the ordinance was written and its possible impact. He needs time to review the ordinance and amendments before he takes action.

It would take nine votes to override the mayor’s veto. 

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